The health department has formulated the final draft of the Bihar healthcare investment policy, which aims to attract private investment in the healthcare sector.

Sources said the health department, along with members of Bihar Chamber of Commerce and Industries (BCCI), Confederation of Indian Industry (CII) and Bihar Industries Association (BIA) have jointly formulated the document.

A source said: "The industries department has already vetted the draft. It has now been sent to the finance department. As per the plan, the final draft would be forwarded to the state cabinet within a month to get the nod."

The state government's intention to boost up private investment in the state is already clear with Medanta recently being awarded a first-of-its-kind project in the state capital. Medanta, one of the country's largest super-speciality chains, has grabbed the project of constructing a super-speciality hospital on an area of seven acres of land of Jai Prabha Hospital.

According to the plan, Medanta has to construct the hospital in a public-private partnership mode. Last year, the state government had floated a global tender to select private players for executing the project.

The Telegraph has a copy of the draft policy titled - Bihar healthcare investment policy. One of the important features of the policy is that in the first three years, 100 per cent subsidy would be provided to the healthcare unit towards the interest paid on loans from banks. In the fourth and the fifth year, a 10 per cent subsidy would be provided to the healthcare unit while from the sixth to the tenth year, a seven per cent subsidy would be provided for the same.

The state government would provide incentives once private players set up the hospitals, says the policy document. According to the policy, if any entrepreneur acquires the technical knowledge from any recognised national/international or state-level institutions to expand his/her healthcare unit, he/she would be reimbursed 30 per cent (maximum Rs 30 lakh) of the fees paid to the organisation for the technical know-how.

Besides, the healthcare units will be entitled to avail 80 per cent reimbursement against the admitted VAT/CST/ entry tax for a period of 10 years.

Health experts had a mixed reaction regarding the policy.

The general secretary of Bihar Superannuated Doctors Association, Ajay Kumar, said it would have been better if the government had initiated steps to improve the conditions of the government hospitals before motivating private investment in the healthcare set-up. "Bringing a policy to attract private investment in the health sector is a welcome step but the state government should first think about providing quality healthcare in the government hospitals by upgrading their infrastructure.

Sunil Kumar Singh, a member of state chapter of Indian Medical Association said: "The policy would not only help in bringing quality healthcare facilities in the state, but it would also help in research and training in the health sector in future. The state cannot develop without improving the healthcare set-up and the private sectors can play a big role in it," said Singh.