Measures taken under Union Budget 2025-26 to boost India’s Health Care System
Union Budget 2025-26 includes many measures to strengthen India’s health care infrastructure, train medical professionals and foster global collaboration.
The government has allocated ₹90,958 crore for health care. This will improve accessibility and quality. Over the next five years, India will add 75,000 medical seats, with 10,000 in FY26 alone. More doctors will be trained to meet demand.
From limited infrastructure in the 1980s, India has become a health care leader. The ‘Heal in India’ and ‘Heal by India’ initiatives aim to attract international patients. Improved hospital infrastructure, streamlined visa processes and public-private partnerships will help.
India will also address the global shortage of health care professionals by training and sending more doctors, nurses and paramedics abroad.
Note: The Heal in India initiative is a government-led program to promote medical tourism in India.
Heal by India' initiative aims to serve the world by increasing and improving health workforce mobility from our India to the various parts of the world .
The 2025 Union Budget proposes important changes in the import duties on life-saving drugs, aimed at improving access to critical medicines for patients. The Basic Customs Duty (BCD) on life-saving drugs remains at 5%. However, the budget introduces additional concessions for specific medicines.
To reduce treatment costs, 36 life-saving drugs will receive customs duty exemptions. This will lower the cost of cancer, rare disease and chronic condition treatments. Additionally, 13 new patient assistance programmes will help people access critical medications.
Note: Union Budget 2025-26 added 36 life-saving drugs to the fully exempt category and reducing customs duty to 5 percent for six additional drugs.
Exempted drugs include Tepotinib (non-small cell lung cancer), Avelumab (monoclonal antibody for certain cancers), Asciminib (white blood cell cancer), Alglucosidase Alfa (Pompe disease) and Mepolizumab (severe asthma). Bulk drugs used in their production will also benefit, lowering costs for domestic pharmaceutical companies and improving affordability for patients.
Finished formulations of medicines are subject to GST at 12%. However, medicines for critically ill patients may be covered under a 5% GST rate, offering some relief for essential drugs used in life-threatening situations.
With more than 97% of medicines sold in India being off-patented and domestically manufactured, the impact on the domestic industry from duty cuts on imported drugs is minimal. These duty cuts primarily target imported patented medicines that are typically used for critical ailments. By reducing import duties, these medicines can become more affordable for patients particularly for those who need costly treatments.
India is a major pharmaceutical manufacturing hub, ranking as the third largest manufacturer of medicines in the world. While less than 3% of the medicines sold in India are imported, the vast majority are off-patented drugs produced domestically. Indian-made medicines are known for being highly cost-effective, with prices being over 52% cheaper than global counterparts. The focus on drug research and innovation in India is expected to further reduce the dependence on imports, fostering growth in domestic drug production.
Yes, all medicines sold in India, whether imported or locally manufactured, are regulated by the Drugs Price Control Order (DPCO). This regulation ensures that medicines (especially -- that are included in National List of Essential Medicines) are priced reasonably. Prices of NLEM medicines are determined by the National Pharmaceutical Pricing Authority (NPPA), ensuring affordability and accessibility for patients.
India's pharmaceutical industry continues to produce affordable medicines. It contributes to its reputation as the world’s pharmacy. In addition to the cost-effectiveness of Indian-made drugs, government initiatives like Pradhan Mantri Jan Aushadhi Pariyojna and Ayushman Bharat aim to make healthcare and medicines more accessible to the public. Patient assistance programmes by drug manufacturers, advocacy groups, and charitable organizations also help ensure that patients have access to critical medicines at lower costs.
The budget targets the growing cancer burden with 200 day-care cancer centres in district hospitals. These centers will provide essential treatments such as chemotherapy and immunotherapy reducing the need for patients to travel to major cities for specialized care. This will provide specialized care to rural populations, ensuring early diagnosis and better outcomes.
Note: As per the National Centre for Disease Control (NCDC) around 1.46 million new cancer cases were recorded in the year 2022. The exemption on life-saving drugs is expected to provide crucial relief to affected families.
Budget focuses on Artificial Intelligence (AI) and digital health. New National Centres of Excellence will drive innovations in diagnostics, treatment and research enhancing patient care and global health systems.
2025-26 budget highlights India’s growth as a global health care hub. By embracing technology, strengthening medical education and improving access to care India is not only healing its own people but also contributing globally. India’s health care system is setting new benchmarks worldwide.
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PRACTICE QUESTION Q.Examine the role of funding, infrastructure improvement and international collaborations in shaping India’s healthcare future. 150 Words PREVIOUS YEAR QUESTIONS ON HEALTH Q.Appropriate local community level healthcare intervention is a prerequisite to achieve ‘Health for All’ in India. Explain. 2018 Q.Besides being a moral imperative of Welfare State, primary health structure is a necessary pre-condition for sustainable development.” Analyze. 2021 Q.Public health system has limitations in providing universal health coverage. Do you think that the private sector could help in bridging the gap? What other viable alternatives would you suggest? 2015 |
How will the increased health care funding in Union Budget 2025-26 benefit India's healthcare system?
The ₹90,958 crore allocation boosts infrastructure, adds 75,000 medical seats, and improves accessibility and quality of health care.
What initiatives are included in the Union Budget 2025-26 to make India a global health care leader? Heal in India and Heal by India promote medical tourism and the export of health professionals, strengthening India's global health position.
How does the reduction in customs duties on life-saving drugs in Union Budget 2025-26 impact patients?
The reduction makes critical drugs more affordable, with 36 drugs receiving full duty exemptions and six others having reduced duties.
What is the role of GST on medicines in India and how does it affect critically ill patients?
Medicines for critically ill patients are taxed at 5% GST, lowering treatment costs for life-threatening conditions.
How does India’s pharmaceutical industry contribute to affordable medicine access, and what initiatives help with this?
India produces 97% of its medicines domestically. Programs like Jan Aushadhi and Ayushman Bharat ensure affordable access to essential drugs.
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