Union Budget 2026: Healthcare Push Sends Strong Signals; Industry Reacts to Biopharma, Innovation & Access

Industry leaders noted that such duty exemptions, combined with broader biopharma and clinical research initiatives, could improve access to advanced therapies while easing the financial burden on patients.

As the Union Budget 2026–27 was announced, the healthcare and life sciences industry read it as a strong signal of intent, with the government placing healthcare firmly at the centre of India’s economic and innovation roadmap. The Budget’s emphasis on Biopharma SHAKTI, mental health, medical tourism, workforce expansion, and diagnostics drew widespread attention across the sector.

Industry leaders described the Budget as a shift from incremental reform to ecosystem-building, aimed at strengthening India’s healthcare manufacturing, research, and delivery capabilities.

Biopharma SHAKTI sets the tone

The announcement of Biopharma SHAKTI, with an outlay of ₹10,000 crore over five years, emerged as the Budget’s most closely watched healthcare move. The programme is expected to accelerate domestic manufacturing of biologics and biosimilars while strengthening research and regulatory capacity.

“The ₹10,000 crore allocation under Biopharma Shakti reflects a clear recognition that India’s biopharma ambitions will be shaped not only by manufacturing scale, but by the strength of its clinical and regulatory foundations,” said Ankit Modi, Founding Member and Chief Product Officer, Qure.ai.

The proposal to create a nationwide network of 1,000 accredited clinical trial sites and strengthen regulatory review was seen as a critical step in improving India’s global credibility in biopharma research.

Welcoming the move, Rajwinder Mehdwan, Managing Director & CEO, Roche Pharma India, said the integrated focus on innovation, manufacturing and regulation would help bring high-quality therapies to patients faster and reinforce India’s transition to a value-led healthcare system.

Shweta Rai, Managing Director – India and Country Division Head – South Asia, Bayer Pharmaceuticals, said, “The Union Budget 2026 positions healthcare and life sciences as a critical pillar of India’s long-term economic and social progress, aligned with the vision of Viksit Bharat. We welcome the government’s focus on the Biopharma Shakti initiative, with an outlay of ₹10,000 crore over the next five years, which will strengthen domestic biopharma manufacturing and research and development capabilities. The Budget's emphasis on supportive R&D tax incentives will further encourage innovation in biologics and biosimilars while rationalisation of customs duties on APIs, raw material and medical devices will strengthen domestic value chains.''

Healthcare turns into a long-term growth engine

Several industry leaders pointed to a structural shift in how healthcare is being positioned within India’s growth strategy. “With healthcare allocation crossing the ₹1 lakh crore mark for the first time, we are seeing a shift from a social utility to a high-growth asset class,” said Ajay Mahipal, Co-founder & General Partner, HealthKois.

He added that Biopharma SHAKTI, upgraded NIPERs, and regulatory strengthening would provide predictability for long-term capital deployment in deep science and healthcare innovation.

MedTech & diagnostics see demand-side momentum

The Budget’s focus on workforce expansion and medical infrastructure was welcomed by MedTech and diagnostics players, who see direct demand creation ahead.

“The addition of one lakh allied health professionals across radiology, anesthesiology and OT technology will directly increase demand for medical devices and equipment,” said Dr. Shravan Subramanyam, Managing Director, BPL Medical Technologies.

He also highlighted the proposal to set up five Medical Value Tourism hubs, calling them a strong opportunity for indigenous MedTech solutions across diagnostics, post-care and rehabilitation.

Echoing this sentiment, V. Govindarajan, Founder and Managing Director, Aarthi Scans & Labs, said the expansion of allied health institutions would help diagnostics networks scale deeper into tier-2 and tier-3 cities.

Mental health & trauma care get overdue attention

The Budget’s emphasis on mental health, including the proposal to set up NIMHANS-2, expand emergency and trauma care centres, and increase district hospital capacity by 50%, was widely seen as a critical intervention.

“The expansion of emergency and trauma care centres across district hospitals is a crucial step towards safer pregnancy and reproductive healthcare services,” said Dr. Kanika Batra Modi, Assistant Director and Clinical Lead, Max Institute of Cancer Care.

Industry leaders also welcomed the plan to train 1.5 lakh caregivers, calling it essential for strengthening maternal, geriatric, and home-based care.

Affordability & GST reforms in focus

Affordability measures, including customs duty exemptions on 17 life-saving drugs, drew positive reactions, particularly from patient-facing healthcare providers.

“The reduction in GST on ophthalmic equipment has already lowered barriers to advanced eye care,” said Dr. Arun Singhvi, MD & Group CEO, ASG Eye Hospital, while urging further reforms to address embedded taxes and input tax credit limitations.

AYUSH & traditional medicine gain institutional backing

The proposal to set up new All India Institutes of Ayurveda and upgrade AYUSH pharmacies was seen as a turning point for traditional medicine.

“The Budget provides a strong institutional and research-backed foundation for Ayurveda to gain global credibility,” said Pawanjot Kaur, Co-founder, Ayuvya Ayurveda.

Dr. Pallavi Sharma, Director, Kailash Healthcare, said, ''The Budget's focus on the development of Ayurveda through the establishment of new All India Institutes and the improvement of Ayush pharmacies is a major positive for the Indian healthcare sector. Through this Budget, healthcare professionals will also be able to benefit from better research, training, and integration of Ayurveda with preventive and wellness-oriented healthcare.''

Innovation, AI & digital health underpin future growth

Beyond direct healthcare spending, industry leaders highlighted the Budget’s broader focus on AI, skilling and innovation ecosystems as key enablers for digital health.

“The Budget lays the groundwork for digital healthcare by strengthening clinical research, regulatory trust and indigenous innovation,” said Satish Kumar Singh, Founder, MY LYF CARE.

A strong foundation, execution now critical

While some leaders called for higher public healthcare spending to strengthen last-mile access, there was broad agreement that Budget 2026 set a clear and credible direction.

“The Budget demonstrates a deep understanding of what it takes to build globally competitive healthcare industries. Execution will now be the key differentiator,” said Dr. Saurabh Arora, Managing Director, Auriga Research.

Affordability measures bring relief for cancer care

The Budget’s decision to exempt Basic Customs Duty on 17 life-saving cancer drugs was seen as a patient-centric move that could significantly reduce treatment costs, particularly in oncology-focused care.

“In today’s Budget speech, the Finance Minister has made 17 crucial drugs imported for cancer treatment completely duty-free,” said Navneet Bali, Executive Director and CEO, Clearmedi Healthcare.

“For us at Clearmedi Healthcare, with our strong focus on oncology, this is fabulous news. It will allow us to make cancer treatment more affordable for our patients, in line with our mission - ‘Everyone, Everywhere, Equally’.”

Surjeet Thakur, Founder and CEO of TrioTree Technologies, said, ''The decision to exempt basic customs duty on 17 drugs used for cancer treatment is a highly welcome step that will make critical therapies more affordable.''

Public health systems & capacity building strengthened

Beyond innovation and manufacturing, the Budget also reinforced the core public health architecture, with higher allocations and renewed focus on emergency care and workforce development.

“I don’t know whether this Budget can be called favourable or historic, but it definitely lays down a strong foundation for the future and showcases India’s strength,” said Sanjeev Singh, Medical Director, Amrita Institute of Medical Sciences.

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