STRUCTURE AND UTILISATION OF HEALTH SERVICES 99 from outside and within the health sector. The former was considered to be difficult since developing countries would have to cut back investments in "productive" areas in order to generate addition^ resources for health. In addition, since developed countries were also facing a fiscal crisis the quantum of international aid available would also reduce. Given this scenario, they advocated mobilising additional resources from within the health sector itself. Tapping households for payments, introduction of user fees in public hospitals and devising mechanisms for risk sharing through insurance schemes were some of the options considered. The understanding was that public investments should focus on preventive programmes and that cost recovery mechanisms would be better suited for curative services. This approach no longer views health care as a "need", but starts viewing it as a "demand" defined by the consumers' ability and willingness to pay. This understanding has perforce influenced the policies of developing countries which have accepted Bank and IMF funding under the Structural Adjustment Programmes (SAP). The experience of some Latin American and African countries shows that there has been a cutback on investments in health and that various cost recovery mechanisms prescribed by the Bank have been tried.2 Similarly, in India, there has been a decline in allocations to certain sub-sectors of health and, at the same time, there have been efforts at experimenting with mobilising additional resources for the health sector. Both the World Bank's country report on India, "India: Health Sector Financing—Coping with Adjustment; Opportunities for Refora^', and WDR 1993 have to be read in the context of the structural adjustment programme. The understanding seems to be that if SAP has to succeed, it is necessary to provide a safety net for the vulnerable sections and therefore selective investment needs to be made in health and allied sectors. The Bank has made certain recommendations for restructuring curative services which will have far-reaching consequences for the structure of health services. The basic thrust of WDR 1993 is to: 1. Cutback on tertiary care in the public sector; 2. Finance essential clinical services atleast to the poor; 3. Finance and ensure delivery of public health package including AIDS prevention; and 4. Improve management of public health. With the cutback on public expenditure the Bank advocates^a more prominent role for the private sector in the provision of curative services by providing subsidies and even as it advocates its regulation. The purpose of this paper is to critically examine the prescriptions of both these reports with respect to the provision of curative health services, given the inter-state variations in the structure and