The Centre should provide stimulus for the healthcare industry to attract fund, including facilities to borrow money on a long term basis if it is looking to improve the healthcare scenario, said Pratap C Reddy, executive chairman, Apollo Hospitals Enterprise Ltd. The Cabinet Committee’s recent decision to include hospitals in the master list of infrastructure sub-sectors is a healthy sign, he said.
Presenting the corporate healthcare service providers’ budget expectations, Reddy said, “Don’t give us funds, give us stimulus to attract fund, equity along with tax reductions to increase healthcare service scenario. It should also help to attract debt.”
It should create environment for the healthcare industry to be able to borrow money on a long term basis with a timeline of over 10 years. In healthcare, returns from healthcare services grow in long term, necessitating longer term to remit the debt, compared to some of the other sectors.
He added that the decision of Government of India to include the sector in the infrastructure sub sectors would facilitate a coordinated approach amongst financing agencies. This would enable the sector to arrange financing from entities like India Infrastructure Finance Company Limited (IIFCL), optimising the growth of the sector.
“We need to invest around Rs 55,000 crore to Rs 60,000 crore each year for the next 10 years.
That is, we need Rs 6,00,000 crore to be invested in the healthcare sector in next 10 years to meet the demand,” he said.
Further, the tax holiday scheme under the Section 80IB has to be extended from the present five years to that of 10 years, including all new facilities which offer ambulatory services like eye hospitals and day care surgery centres across the country. It should also facilitate a healthcare real estate investment trust concept for the investor to assess returns from the capital invested on land and building costs, and returns from the assets directly used in hospital operations like medical equipment, separately.
It also asked for increase in quantum of deduction towards payment of medical insurance premium, enahcement of medical reimbursement exemption limit of salaried employees and inclusion of hospital as an industrial undertaking under section 27A of Income Tax Act to benefit setting off and carrying forward of business losses, on amalgamation to support mergers and acquisitions of hospitals.
