New Delhi is buzzing with anticipation as the Union Budget 2026-27 approaches on February 1, 2026. India’s healthcare and pharmaceutical industries are pinning high hopes on this fiscal blueprint to transform the nation’s health infrastructure. Experts are urging the government to ramp up public spending, streamline GST structures, and supercharge digital health initiatives alongside robust research funding. This budget could mark a pivotal shift, propelling India’s health system into a more resilient future.
Stakeholders emphasize that elevating government health expenditure to 3-5% of GDP is non-negotiable. Currently, spending remains woefully inadequate amid a surge in non-communicable diseases (NCDs), which account for nearly 65% of deaths in the country. This escalating burden is straining an already overburdened system, demanding immediate and bold interventions.
A leading health policy analyst remarked, ‘India stands at a critical juncture where policy execution must match ambition.’ They advocate pushing public health outlay beyond 2.5% of GDP to forge a sustainable ecosystem capable of withstanding future challenges.
The 2025 reduction of GST on medical devices and diagnostic kits to 5% was a welcome move, but experts call for correcting the inverted duty structure. For instance, radiation protection equipment still attracts 18% GST, which should drop to 5%. Such reforms would ease pressures on domestic manufacturers and slash treatment costs for patients.
With 80% reliance on imported medical devices, bolstering the ‘Buy India’ initiative is crucial. Enhancing schemes like PRIP for research and development could spur high-quality local production, reducing import dependency and fostering self-reliance.
There’s a strong push to fortify primary and secondary healthcare in Tier-2, Tier-3 cities, and rural areas. Incentives like Priority Sector Lending (PSL) and Viability Gap Funding (VGF) for diagnostic hubs and eye hospitals could ensure affordable, quality care reaches every corner.
Digital health, AI, and IoT-based monitoring hold transformative potential. AI-driven diagnostics and digital platforms promise early disease detection, shifting healthcare from reactive to preventive models, making treatments more effective and cost-efficient.
Another expert highlighted, ‘This budget is make-or-break for healthcare.’ Integrating digital infrastructure with pharmacies, diagnostics, and home care could democratize access, while healthtech innovations elevate patient outcomes and experiences.
In summary, the health sector seeks actionable decisions over mere announcements. Increased spending, smarter policies, digital leaps, and local manufacturing can fast-track India toward a robust, accessible healthcare powerhouse.
