Healthcare Sector Pins Hopes on Budget 2026 for Strategic Support
The Indian healthcare industry eagerly awaits Budget 2026. Industry leaders believe this budget will clearly show how the government positions healthcare within India's growth priorities. The sector currently faces large patient volumes, uneven capacity distribution, and heavy reliance on imported medical equipment.
Sudarshan Jain, Secretary General of the Indian Pharmaceutical Alliance, highlights global challenges. He points to Donald Trump's tariffs, supply chain disruptions, and geopolitical uncertainty. These factors underscore the urgent need for strategic government support. Such support would maintain and strengthen India's competitive edge in pharmaceuticals.
Expanding Medical Infrastructure Nationwide
Dr. Sabine Kapasi, CEO of Enira Consulting, calls for a major infrastructure push. She emphasizes expanding hospitals and medical colleges in Tier 1 and Tier 2 cities. These regions already handle a significant share of the national patient load. Workforce expansion must also include faculty, nurses, and allied health professionals to ensure quality care.
Dr. Ramesh Kancharla, Founding Chairman of Rainbow Children’s Medicare, focuses on child health. He notes that while child-welfare's budget share rose to 2.29%, its GDP share fell to 0.33%. "For a country with a vast paediatric population, this is simply inadequate," he states. Dr. Kancharla urges India to set a long-term goal of raising child-focused expenditure toward 5% of GDP.
Dr. Mukesh Batra, Founder-Chairman Emeritus of Dr Batra’s Healthcare, sees a positive backdrop. He references the Economic Survey 2025 and the National Health Policy. These documents reaffirm the government's commitment to strengthening capacity through medical college expansion, new AIIMS, and flagship initiatives like PM-ABHIM.
Boosting Domestic Manufacturing and Innovation
Dr. Kapasi also advocates for a sharper focus on domestic manufacturing. She proposes a redesigned Production Linked Incentive scheme. This PLI should support R&D-led medical technology manufacturing. Such a move could improve affordability, strengthen supply security, and build export capacity.
Satish Reddy, Chairman of Dr Reddy’s Laboratories, agrees on the need for a strategic shift. He believes the pharma industry must move from volume-led expansion to value-driven growth. This requires closer alignment between science, policy, and industry.
Dev Tripathy, Head of Finance at Philips Indian Subcontinent, highlights technology's role. He suggests artificial intelligence can help bridge the supply-demand gap. Tripathy calls for a sustainable MedTech manufacturing ecosystem. New PLI schemes should encourage holistic development. Rationalized duty structures are essential to make healthcare more affordable and accessible.
Improving Healthcare Access and Affordability
Dr. Batra calls for strengthened insurance coverage and wellness provisions. These should include long-term preventive care. He also recommends accelerated investments in digital health infrastructure and community-based clinics. This would bridge access gaps in Tier-2, Tier-3, and semi-urban regions.
Dr. Kancharla emphasizes paediatric care access. He notes the need to expand Diplomate of National Board seats in paediatrics and super-specialities. This ensures every child, regardless of location, receives skilled and timely care. He also proposes tax deductions for essential diagnostics and annual health check-ups up to ₹10,000 per child. This would ease financial burdens and promote early intervention.
Addressing Expenses and Seeking Fiscal Support
Dr. Batra suggests reducing out-of-pocket expenses for patients. He advocates for sustainable, inclusive growth through targeted tax incentives, employer-led wellness programs, and robust public-private partnerships.
According to Jain, pharma companies seek specific fiscal measures. These include patent coverage for Indian and international registrations, a competitive 5% tax rate aligned with global practice, and support for competitive manufacturing. Support should come through widening the inverted duty structure, Make in India incentives, backward integration, and FDI in pharma manufacturing.
Himanshu Baid, MD of Poly Medicure, calls for a policy approach that reduces cost disabilities. He wants policies that nurture local innovation and enable faster market access. Baid specifically highlights the inverted duty structure problem. Many finished medical devices face a 5% tax, while most inputs and services attract 18%. This leads to large Input Tax Credit accumulations and increased working-capital pressures. Addressing this imbalance is essential.
Baid further recommends aligning the job-work GST rate for medical devices with the pharmaceutical sector's concessional 5% rate. Revising the refund formula to include ITC on input services and capital goods would offer immediate relief. It would also bring greater parity across the healthcare manufacturing ecosystem.
Strengthening Research and Development
Reddy emphasizes the need for a structured funding framework. This would deepen innovation and R&D across India. It would enable pharma companies to translate advanced research into complex, high-value therapies while improving patient access.
"Building a supportive ecosystem ensures sustained financing for pharmaceutical innovation," Reddy adds. He calls for regulatory reforms to encourage greater participation from start-ups. This would be a significant step forward in strengthening India's life sciences innovation landscape.
The healthcare industry's collective voice presents a clear roadmap for Budget 2026. Leaders stress that strategic investment and policy support are crucial. They believe this will ensure the sector meets India's growing healthcare demands and maintains its global position.
