Healthcare and Infrastructure Get Big Push; Fiscal Deficit Pegged At 9.5% For FY21

FM Nirmala Sitharaman announced the first Union Budget of the decade which envisions to bring the economy back on track

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Finance Minister Nirmala Sitharaman on Monday announced what can be considered one of the most crucial Union Budget of our lifetime. The Budget which is expected to bring respite to India's debilitating economy was the country’s first “digital Budget”, as it was paperless. Wreaked by the ongoing pandemic, the country’s healthcare sector gained the most from the Budget. In an unprecedented way, the overworked sector received a 137 per cent increase in Budget allocation of INR 2.32 lakh crore. The allocation is earmarked keeping in mind the need to strengthen three areas: preventive, curative and wellbeing. FM Sitharaman also announced a plethora of new initiatives in the infrastructure sectors including roads and railways, and in agriculture development, in order to create more employment opportunities.

MoS for Finance and Corporate Affairs - Anurag Singh Thakur and Union Finance Minister Nirmala Sitharaman

The finance minister during her speech also announced that the government has estimated India’s fiscal deficit for the current financial year at 9.5 per cent, a 6 percentage points increase from what was estimated during last year’s Budget  and has set a target at 6.8 per cent for the financial year 2022. This sharp increase in fiscal deficit can be seen in a way the government is willing to spend more on its assets which will prove to be beneficial in the long term.

As healthcare and infrastructure were the spotlight of this year’s Union Budget, let’s have a look at some of the major announcements.


Healthcare was a sector for which experts were rooting to get a substantial increase in allocation mostly after the pandemic which has only exposed how behind the country’s healthcare system compared with any other developing or developed countries. Lack of beds,  ICUs and ventilators have severely dented the image of India in terms of healthcare in front of the world. Addressing everyone's worry, the government focused the most in the healthcare sector as it has increased budget allocation to the sector by 137 per cent compared to last year.

  • The total budget outlay for healthcare is INR 2.23 lakh crore, an increase of 137 per cent from last year.

  • Announcement of new scheme: PM Atmanirbhar Swasth Bharat Yojana with a total outlay of INR 64,180 crore over a period of six years.

  • The new scheme is expected to support 17,000 rural and 11,000 urban wellness centre; 

  • The government has also earmarked INR 35,000 crore for COVID-19 vaccines in 2021-22.

  • The government has allocated INR 2,663 crore for department in health research.

  • Around INR 60,030 crore has been set for the department of drinking water and sanitisation

Commenting on the budget, Nupur Khandelwal, co-founder of Navia Life Care, said, “The budget has surpassed everyone’s expectations with the government’s clear focus on health and wellness. With a 137 per cent increase in total health outlay from INR 94,000 crore to INR 2.24 lakh crore in this year’s budget, the government has made clear that health is the main priority. This is definitely a positive and much-needed increase in public expenditure required for ramping up India’s burdened healthcare sector, especially after being exposed during COVID-19. Around INR 35,000 crore for the vaccination program will hopefully affirm a ‘V-shaped recovery’ in the next financial year. This will certainly boost the confidence of healthcare workers as well as common people and is a decisive step towards resuming economic activities and tread on the path of growth.

 “At the outset, I congratulate the government of India for undertaking this arduous task in these unprecedentedly challenging times. The emphasis on clean air, safe drinking water and nutrition are critical factors for better maternal and child health and will go a long way in reducing both maternal mortality rate and infant mortality rate (IMR). This will improve the quality of life in the lowest strata of our society. Besides, the announced roll out of pneumococcal vaccine outside the existing five states to the entire country will also play a critical role in helping India contain infectious diseases as well as complement the COVID-19 vaccines in the process of building immunity as well as herd immunity” said Dr Gauri Agarwal, founder of Seeds of Innocence and Fertility expert.

Ashok Patel, founder and chief executive officer, Max Ventilator, said, “Keeping in mind the learning curve from Covid-19, the government has done well to finally take the bull by its horns. Raising the healthcare budget by 137 per cent at more than INR 2.23 lakh crore signals that resolve of the government and was a much-needed measure. More importantly, the government’s inclusion of preventive medicine, curative medicine and well being implies that it is taking a comprehensive view of health and not adopting an ad-hoc policy stance. The allocation of INR 64,000 crore plus funds for Atma Nirbhar Health Yojana is also welcome signifying the intent and the will to make the country self-reliant for health. The expansion of PLI scheme with an allocation of INR 1.97 lakh crore for the next five years will also impart a boost to the medical device manufacturing in the country.”


Pace of infrastructure in a country is an indication of the country's economy. Higher the infrastructure growth, better the growth rate. Infrastructure projects in roads and railways not only helps in connecting various parts of the country thus bolstering trade but also creates large employment opportunities over the years and even after the projects. Surely after a year which saw mass layoffs due to months long lockdown, India which continues to aim for a $5-trillion economy needs advanced infrastructure and high employment. 


  • More than 13,000 km length of roads, at a cost of INR 3.3 lakh crore, has already been awarded under the INR 5.35 lakh crore Bharatmala Pariyojana project of which 3,800 km have been constructed. By March 2022, the government would be awarding another 8,500 km and complete an additional 11,000 km of national highway corridors.

  • 3,500 km of National Highway works in the state of Tamil Nadu at an investment of INR 1.03 lakh crore. These include Madurai-Kollam corridor, Chittoor-Thatchur corridor. Construction will start next year

  • 1,100 km of National Highway works in the State of Kerala at an investment of INR 65,000 crore including 600 km section of Mumbai-Kanyakumari corridor in Kerala.

  • 675 km of highway works in the state of West Bengal at a cost of INR 25,000 crore including upgradation of existing road-Kolkata –Siliguri.

  • National Highway works of around INR 19,000 crore are currently in progress in Assam. Further works of more than INR 34,000 crore covering more than 1300 km of National Highways will be undertaken in the state in the coming three year

  • Finance minister also announced INR 1,18,101 crore for the Ministry of Road Transport and Highways, of which INR 1,08,230 crore is for capital, the highest ever.  


  • The government expects Western Dedicated Freight Corridor (DFC) and Eastern DFC will be commissioned by June 2022. 

  • For passenger safety, the government will introduce the aesthetically designed Vista Dome LHB coach on tourist routes; high density network and highly utilized network routes of Indian railways will be provided with an indigenously developed automatic train protection system that eliminates train collision due to human error. 

  • The finance minister has provided a record sum of INR 1,10,055 crore, for Railways of which INR 1,07,100 crore is for capital expenditure.

Urban Infrastructure

  • A  new  scheme  will  be  launched  at  a  cost  of  INR 18,000  crore to support  augmentation  of  public  bus  transport  services.

  • For Metro, two new technologies i.e., ‘MetroLite’ and ‘MetroNeo’, will be deployed to provide metro rail systems at much lesser cost with same experience

  • Centre will provide funds to few of the metro projects in different cities which includes Kochi, Bengaluru, Nagpur and Chennai.

Power Infrastructure

  • The government has  added 139 Giga Watts of installed capacity, connected an additional 2.8 crore households and added 1.41 lakh circuit km of transmission lines.

  • A revamped reforms-based result-linked power distribution sector scheme will be launched with an outlay of INR 3,05,984 crore over 5 years.

  • The government has proposed to launch a Hydrogen Energy Mission in 2021-22 for generating hydrogen from green power sources. 


  • Seven projects worth more than INR 2,000 crore will be offered by the major ports on public private partnership mode in FY 21-22.

  • A scheme to promote flagging of merchant ships in India will be launched. For this the government has earmarked INR 1,624 crore for next five years. The scheme is also set to create huge employment opportunities over the years. 

  • by providing subsidy support to Indian shipping companies in global tenders floated by Ministries and CPSE.


The Agriculture Infrastructure Fund has been increased to INR 40,000 crore and micro-irrigation corpus will be doubled to INR 10,000 crore