Federalism, fiscal priorities and the political economy of public health in India
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Centre of Excellence in Public Policy, Law and Governance, Indian Institute of Technology Kharagpur, Kharagpur, India
Popul. Med. 2026;8(Supplement Supplement 1):A3574
ABSTRACT
BACKGROUND:
Public health outcomes in India are deeply influenced by political and economic processes that shape governance, financing and accountability. Despite policy commitments and periods of economic expansion, public investment in health remains modest, preventive care underdeveloped and health inequalities pronounced across states and social groups. Understanding these outcomes requires moving beyond programmatic assessments to examine how federal structures, fiscal priorities and political incentives interact within India’s public health system.
METHODS:
This paper employs a qualitative policy analysis drawing on secondary sources, including Union and state budget documents, national health policy frameworks and published evaluations of major health reforms since the launch of the National Health Mission. Comparative analysis across states is used to assess variations in public spending patterns, governance capacity and service delivery arrangements. The study is informed by political economy and public finance perspectives to interpret observed patterns in health system performance.
RESULTS:
The analysis reveals three key findings. First, public health financing in India continues to favour curative and insurance-based interventions over preventive and primary care functions, reflecting short-term political incentives. Second, fiscal federal arrangements and intergovernmental transfers have not adequately corrected regional disparities, leading to persistent inequities in infrastructure and workforce distribution. Third, policy-driven expansion of private sector participation has increased service availability in some contexts but has also weakened regulatory oversight and raised concerns regarding equity and public accountability.
CONCLUSIONS:
India’s experience demonstrates that improvements in public health outcomes are constrained less by technical limitations than by governance and political economy factors. Strengthening public health requires sustained fiscal commitment, greater decentralisation with accountability and a renewed emphasis on the state’s stewardship role. These findings underscore the importance of aligning political and economic priorities with long-term public health goals in federal and resource-constrained settings.