Union Finance Minister, Nirmala Sitharaman has announced key measures in her recent budget announcement that reflect the government’s commitment to building a healthcare system that caters to the needs of all citizens, especially the vulnerable sections.

In the Union Budget 2025, Nirmala Sitharaman has allocated INR 98,000 crore to the healthcare sector, marking a 12 percent increase compared to the previous year.

This enhanced budget is focused on improving the healthcare infrastructure, advancing research and development, and making essential medicines more affordable and accessible to the public.

One of the significant proposals includes providing relief to patients, particularly those battling cancer, rare diseases, and chronic illnesses. To support these patients, the government will fully exempt 36 lifesaving drugs and medicines from Basic Customs Duty (BCD). In addition, 6 more lifesaving medicines will be subjected to a concessional customs duty of 5 percent. This move is expected to reduce the cost of critical medications, improving accessibility. Furthermore, the government will extend these exemptions to the bulk drugs used in manufacturing these medicines, lowering overall production costs and benefiting patients.

The Union Budget also expands the list of medicines that will be exempt from Basic Customs Duty under pharmaceutical companies’ Patient Assistance Programmes. With this proposal, 37 more medicines and 13 new assistance programs will be included in the list, helping patients by providing these drugs free of charge.

In addition to improving the affordability of medicines, the Union Budget also focuses on boosting medical research and development. To implement the private-sector-driven Research, Development, and Innovation initiative announced in the July Budget, the government has allocated INR 20,000 crore. This funding aims to foster innovation in medical technologies and solutions that could address India’s unique healthcare challenges.

Overall, the Union Budget 2025-26 reflects the government's commitment to enhancing the healthcare sector by increasing funding for infrastructure, promoting affordable and essential medicines, and supporting groundbreaking research and innovation.

Industry’s Take on Union Budget 2025-26

Garima Malhotra, Associate Partner, Healthcare and Lifesciences at Praxis Global Alliance expressed, "The government’s push for improved access to life-saving medicines through the addition of 36 drugs to the exempted list and enhanced support for rare disease treatments is a welcome move. The rationalization of customs tariffs for industrial goods, including incentives for domestic pharmaceutical manufacturing, will further boost India’s position as the ‘Pharmacy of the World.’ The emphasis on R&D with a INR 20,000 crore investment in private-sector-led innovation will also accelerate drug discovery and biotech advancements."

Tarun Gupta, Co-Founder, LISSUN shared, “The 2025-26 Union Budget presents an encouraging step forward in addressing the pressing need for systemic improvements in India's healthcare. Lissun welcomes the expansion of medical education with 10,000 new seats in medical colleges and the focus on increasing specialized training to create a well-equipped workforce, which will positively impact the mental health sector. The credit guarantee cover and the new Fund of Funds, particularly for startups, is a promising move to foster innovation in mental health technology and services, enabling companies like ours to scale and enhance accessibility. We also appreciate the emphasis on the creation of cancer centers, as this marks a broader push towards health equity. However, as we look ahead, further targeted initiatives such as the integration of mental health into primary healthcare, insurance coverage for mental health, and investments in early intervention programs for neurodevelopmental disorders must remain priorities to truly revolutionize the mental health framework.” 

Sachidanand Upadhyay, MD, Lord's Mark Industries Ltd. said, "The government’s focus on strengthening India’s healthcare infrastructure under the Viksit Bharat vision is commendable. The establishment of Day Care Cancer Centres across all district hospitals and 200 cancer centres in FY 2025-26 will significantly improve access to life-saving treatment for patients across the country. Additionally, the exemption and concessional duty on essential medicines and bulk drugs will make critical treatments more affordable, especially for those battling cancer, rare diseases, and chronic conditions. These measures will provide much-needed relief to patients and help build a more resilient healthcare ecosystem. We fully support these initiatives and remain committed to delivering high-quality, cost-effective healthcare solutions to ensure every Indian has access to life-saving treatments."

Nirav Mehta, CEO and Managing Director, CORONA Remedies Ltd. said, “This year’s budget is a welcome move to enhance accessibility of lifesaving drugs and medicines in India. The exemption of basic customs duty on certain drugs under patient assistance programs is an encouraging boost for the pharmaceutical industry. We also welcome the governments’ move to exempt lifesaving medicines from customs duty which will enhance overall affordability of drugs in India This progressive move promotes India to achieve its aim of becoming a global pharmaceutical leader while also making essential treatments more accessible to patients suffering from chronic and severe diseases such as cancer and uncommon ailments. This budget demonstrates the government's commitment to improving healthcare outcomes for all Indians by fostering an environment conducive to the development and delivery of vital treatments. Corona Remedies remains committed to contributing to this mission by providing affordable high-quality treatment solutions and good health for all.”

Speaking on the Union Budget 2025-26, Dr. Sudhir Srivastava, Founder, Chairman, and CEO of SS Innovations, said, “Under the visionary leadership of Prime Minister Modi and his government’s third term, we are witnessing transformative steps in strengthening India’s healthcare system. The Finance Minister’s announcement to expand medical education and healthcare infrastructure is a significant move toward building a more robust healthcare ecosystem. The addition of 10,000 undergraduate and postgraduate medical seats in the coming year, as part of the broader plan to add 75,000 seats over the next five years, is a crucial step in addressing the growing demand for healthcare professionals. This will not only improve the quality of care but also ensure that healthcare services reach every corner of the country, bridging the gap in underserved regions.”

“Another impactful initiative is the provision of broadband connectivity to all government secondary schools and primary health centres in rural areas under the BharatNet project. This will not only enhance digital education but also enable crucial healthcare services like telesurgery to reach remote regions, making high-quality medical expertise accessible to underserved populations. With reliable internet connectivity, medical professionals will be able to perform remote consultations and surgeries, revolutionizing healthcare delivery in rural areas. The government’s focus on strengthening urban livelihoods and supporting vulnerable populations through various initiatives is equally commendable. These measures are vital for enhancing economic stability and providing much-needed employment opportunities, particularly in urban areas. We also welcome the decision to exempt patient assistance programs from Basic Customs Duty (BCD), making life-saving medications more accessible to those in need. This will go a long way in improving healthcare affordability and ensuring that no patient is left behind. At SS Innovations, we are fully committed to advancing healthcare technologies and innovations in alignment with the government’s vision. We believe these policy changes will be transformative in improving healthcare accessibility, quality, and outcomes for all Indian citizens,” added Dr. Sudhir.