The Union Budget for the fiscal year 2025-26 has been announced with a strong emphasis on enhancing healthcare accessibility and bolstering the pharmaceutical industry in India. Among the key measures, the budget has introduced significant exemptions and reductions in duties aimed at making healthcare more affordable and accessible to the masses.
One of the headline changes is the exemption of 36 life-saving drugs from basic customs duty, alongside a reduction of duty to 5% on six critical medicines. This initiative is expected to lower costs for cancer treatments and rare disease medications, thereby easing the financial burden on patients. In addition, the government is pushing for expanded medical education, planning to add 10,000 new medical seats in the next year, with a long-term goal of creating 75,000 new seats over five years.
Another ambitious project from this budget is the ‘Heal In India’ initiative, which aims to position India as a global hub for medical tourism and healthcare services. By promoting India’s affordable and high-quality healthcare, the initiative is designed to attract international patients. To facilitate this, the Medical Tourism Promotion will focus on establishing India as a leading destination for medical treatments. The budget also proposes special medical visa categories for international patients to streamline their entry and stay, reinforcing India’s healthcare infrastructure and enhancing access to essential treatments.
Turning to the pharmaceutical sector, the Union Budget 2025-26 outlines several
measures to influence India’s pharmaceutical industry positively. A substantial
allocation of ₹20,000 crore is earmarked for private sector-led Research and
Development (R&D). This investment is aimed at fostering innovation,
development, and research initiatives within the industry, potentially leading
to breakthroughs in medical science and technology.
On the taxation front, the budget introduces tax reforms that include setting a
new direct tax slab under the new income tax regime, resulting in no income tax
for individuals earning up to ₹7 lakh per annum. This move is anticipated to
increase disposable income, which could boost consumer spending, including on
healthcare products.
Furthermore, the introduction of a National Manufacturing Mission in the budget
seeks to support industries of all sizes, with a particular focus on
pharmaceuticals, under the ‘Make in India’ initiative. This mission provides a
stable framework to support MSMEs (Micro, Small, and Medium Enterprises) and
economic growth, ensuring that the pharmaceutical sector benefits from enhanced
manufacturing capabilities.
Regulatory reforms are also on the agenda, with the establishment of a
High-Level Committee for Regulatory Reforms. This committee’s mandate is to
streamline compliance processes, which could significantly benefit
pharmaceutical companies by reducing bureaucratic hurdles and expediting
product approvals. Such reforms are crucial for maintaining the momentum of
growth in the sector, making it more competitive on a global scale.
These measures collectively reflect the government’s commitment to
strengthening the pharmaceutical sector through enhanced R&D investment,
supportive tax policies, and regulatory improvements. The budget is described
as steady and practical, focusing on sustaining momentum in healthcare and
pharmaceutical advancements.
In conclusion, the Union Budget 2025-26 is a strategic blueprint aimed at
transforming India’s healthcare landscape and pharmaceutical industry. By
reducing costs, promoting medical tourism, investing in R&D, and reforming
tax and regulatory frameworks, the budget sets the stage for a healthier, more
innovative, and globally competitive India in the realm of healthcare and
pharmaceuticals.
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