Written by : Dr. Aishwarya Sarthe
January 25, 2025
As the nation advances toward Vision 2047, the Union Budget 2025-26 offers a critical opportunity to align fiscal policies with long-term health objectives.
India’s healthcare sector stands at a decisive juncture, transitioning from addressing immediate challenges to establishing a sustainable and resilient framework for the future. As the nation advances toward Vision 2047, the Union Budget 2025-26 offers a critical opportunity to align fiscal policies with long-term health objectives. By prioritizing infrastructure enhancement, workforce development, innovation promotion, and greater accessibility, the budget can catalyze transformative progress.
Over the past decade, India’s healthcare indicators have significantly improved. Infant mortality rates have declined, maternal health outcomes have improved, and access to care has expanded through initiatives such as the LaQshya program. Between 2014 and 2024, the number of AIIMS institutions rose from 7 to 19, with plans for 5 more, adding over 5,000 beds to the system. Additionally, healthcare facilities increased from 7,008 in 2005 to over 60,000 in 2021, reflecting a CAGR of 14.4%.
However, critical gaps remain in the sector that need urgent attention. As the healthcare system continues to grow, stakeholders across the industry are keenly awaiting the Union Budget 2025-26 to address these concerns and advance the agenda of an equitable, inclusive, and future-ready healthcare system.
Dr PN Arora, CMD of Yashoda Super Speciality Hospitals, Kaushambi, emphasized the need for fiscal reforms in the healthcare sector. “As one of India’s largest sectors, both in terms of revenue and employment, the healthcare sector has witnessed unprecedented growth. Ahead of the forthcoming budget, we expect the government to reduce input GST on healthcare services. Besides, recent reports highlight the significant discrepancy between premiums collected and claims paid by insurance companies, underscoring the urgent need for reform in India’s healthcare sector. We expect the government to focus on the concern and take certain measures to bridge this gap. Further, increased funding for public health facilities and incentives for private-sector collaboration can improve access to quality care. A focused approach toward enhancing infrastructure in underserved areas will ensure better healthcare outcomes for all citizens.”
The increasing demand for digitization in the healthcare sector has also captured the attention of industry experts.
Nanda Kishore, Chief Information Officer at Continental Hospitals, stated, "Smarter, greener, and more inclusive healthcare is the need of the hour. As India anticipates Budget 2025-26, the healthcare sector looks for a transformative push that integrates advanced technology. This includes funding for next-gen healthcare IT, like advanced EMRs, HIS, and cloud solutions, to modernize care delivery. We expect to see significant support for the Ayushman Bharat Digital Mission (ABDM) to enhance health IDs, exchanges, and interoperability, ensuring a seamless healthcare ecosystem. Public-private partnerships must be further leveraged to scale telemedicine, bridging the urban-rural healthcare divide. With cybersecurity becoming crucial, investments in robust frameworks and training are necessary to protect sensitive health data. Moreover, AI-driven diagnosis, personalized care, and research need stronger backing, while telehealth should receive funding to expand access, particularly in remote areas. Sustainability also takes center stage, with a focus on green energy and waste management solutions for eco-friendly hospitals."
The healthcare system in India also faces significant challenges in terms of access to care, especially in underserved areas. Shuchin Bajaj, Founder and Director of Ujala Cygnus Hospitals, highlighted the importance of investing in infrastructure and workforce. "As a healthcare entrepreneur dedicated to improving access to quality care in underserved areas, I have high expectations from the upcoming healthcare budget. India’s healthcare system faces critical challenges, including a high burden of non-communicable diseases, limited infrastructure in rural areas, and a growing need for skilled professionals. The budget must prioritize investments that address these gaps.
First, increased allocation to public health infrastructure is crucial. Strengthening primary healthcare centers, especially in rural and semi-urban areas, will enable early diagnosis and treatment, significantly reducing the disease burden. Additionally, focused funding for digital health initiatives can revolutionize care delivery. Expanding telemedicine, electronic health records, and digital diagnostic tools will enhance accessibility and efficiency. Second, with India’s cancer burden expected to rise, substantial funding for cancer care infrastructure—like linear accelerators and PET scans—is imperative. Supporting public-private partnerships in oncology will drive innovation and affordability. Third, incentives for healthcare startups and innovative models can catalyze the development of cost-effective solutions for underserved communities. Lastly, addressing the human resource crisis through investments in training and upskilling healthcare workers, particularly in rural areas, should be a top priority."
As India’s healthcare sector prepares to scale new heights in the coming decade, the Union Budget 2025-26 presents an opportunity for transformative reforms. The collective input from healthcare leaders underscores the pressing need for investments in infrastructure, technology, workforce development, and access to quality care.
From reducing GST on healthcare services to expanding digital health initiatives and strengthening public-private collaborations, the expectations are high for a budget that can pave the way for a healthier and more inclusive India. Through these measures, the healthcare system can build resilience, ensure better health outcomes, and contribute to the achievement of Vision 2047.