BJP-ruled states join free dose chorus, Modi government to assess fiscal viability

NEW DELHI: As the chorus for free Covid vaccine doses for states grows louder with even BJP-governed states raising the demand, the finance ministry is looking at whether such a move is fiscally feasible. 

According to highly placed sources, apart from Odisha, West Bengal and Kerala, NDA-ruled Madhya Pradesh and Bihar, too, have urged the Prime Minister’s Office to tweak the vaccination policy to make the jabs available to states for free. 

A senior official in the finance ministry told TNIE that states have questioned the logic behind the Centre’s forcing them to arrange for vaccines on their own or import them at a higher rate.

“Many states have informed the PMO that despite placing orders, the process is slower than expected.  Also, there is a lot of pressure for a rethink over the “transfer of grant” and differential pricing of vaccines.  The finance ministry is going to reassess the fiscal viability and will hold a meeting in a day or two after consultation with the health ministry, the PMO and the Niti Aayog,” said the senior official cited earlier. 

Not just states, even economists are questioning the differential pricing policy which they say creates supply side bottlenecks.

They say India could have used its Rs 35,000 crore vaccine fund created during Budget for FY22 to vaccinate all.

However, the amount of Rs 35,000 crore has been repackaged under the Demand for Grants to states in the Budget. 

Meanwhile, the finance ministry has refuted criticism from a section of economists that there is no provision for expenditure on Covid-19 by the Central government.

“The amount of Rs 35,000 crore has been shown under the Demand for Grants No. 40, titled ‘Transfers to States’,” it said.  

Rs 35,000 crore vax spend

Provisioning Rs 35,000 crore expenditure for vaccines in the FY22 Budget under the title ‘Transfers to States’ does not inhibit the Centre from using the funds to buy Covid-19 shots, the finance ministry said