The Union Budget 2004-05 of Government of India in some way marks a deviation from its preceding budgets in terms of its specific focus on social sector. The budget document is basic policy paper of the government and in some sense provides a mirror of government's priorities. However, one basic question remains how to translate these policies into implementable plans and how to make sure that the government is able to deliver the planned development. Many times we focus on priorities and policies without giving due consideration to ground level realities and the policy pronouncements remain rhetoric. In some ways the recent budget has done the same with the health sector. There is probably lack of clarity on issues the health sector is facing. We aim at addressing some of these issues in context of health sector and describe how this year's budget has missed the focus.