As the Finance Minister prepares to present the Union Budget 2026 on February 1 (Sunday), the healthcare sector is watching closely—with hope, urgency, and a long list of expectations. After years of grappling with pandemics, rising lifestyle diseases, workforce shortages, and escalating costs, India’s health system stands at a critical juncture. For doctors, hospitals, pharmaceutical companies, public health experts, and patients alike, Budget 2026 is expected to go beyond incremental changes and deliver structural reforms that can future-proof healthcare delivery in the country.
Healthcare is no longer a peripheral concern. It is central to economic growth, social stability, and national security. The health sector is seeking a budget that recognises this reality and places health at the core of India’s development agenda.
Higher Public Spending on Healthcare
One of the most consistent demands from the health sector is an increase in public healthcare expenditure. Despite improvements over the years, India’s healthcare spending as a percentage of GDP remains lower than that of many comparable economies. This gap becomes evident in overstretched public hospitals, inadequate primary care facilities, and unequal access to quality healthcare.
The sector expects Budget 2026 to move decisively towards increasing healthcare allocations, with a clear roadmap for sustained growth over the next decade. Higher public spending would enable better infrastructure, stronger disease surveillance, improved access to medicines, and reduced out-of-pocket expenses for patients—an issue that continues to push millions into poverty every year.
Strengthening Primary and Preventive Healthcare
The health sector strongly believes that India can no longer rely solely on hospital-based, curative care. The rising burden of non-communicable diseases such as diabetes, heart disease, hypertension, obesity, and cancer demands a preventive, community-focused approach.
From Budget 2026, stakeholders expect enhanced funding for primary healthcare, including wellness centres, screening programs, vaccination drives, nutrition initiatives, and school-based health interventions. Early detection and prevention not only save lives but also significantly reduce long-term healthcare costs. A strong primary care system is the foundation of an efficient and equitable healthcare model.
Reducing the Burden of Out-of-Pocket Expenses
High out-of-pocket expenditure remains one of the biggest pain points in India’s healthcare system. Even with government insurance schemes, many patients continue to bear a significant portion of treatment costs, especially for advanced care, diagnostics, and long-term illnesses.
The health sector wants Budget 2026 to expand insurance coverage, improve reimbursement rates, and plug gaps in existing schemes. Rationalisation of GST on medical devices, consumables, and life-saving drugs is another key expectation, as indirect taxes often translate directly into higher bills for patients. Making healthcare affordable is not just a welfare issue—it is an economic necessity.
Investment in Healthcare Infrastructure
Infrastructure gaps continue to challenge healthcare delivery, particularly in rural and semi-urban India. District hospitals, primary health centres, and community health facilities often lack adequate beds, modern equipment, and diagnostic capabilities.
Healthcare providers expect Budget 2026 to prioritise capital investment in upgrading existing facilities and building new ones where needed. This includes expanding ICU capacity, strengthening emergency care, improving laboratory networks, and ensuring reliable supply chains for essential medicines and equipment. Robust infrastructure is crucial not only for routine care but also for managing outbreaks, disasters, and public health emergencies.
Addressing Healthcare Workforce Shortages
The shortage of trained healthcare professionals remains a structural weakness in India’s health system. Doctors, nurses, paramedics, and allied health workers are unevenly distributed, with rural and remote areas facing the most severe gaps.
The health sector is looking to Budget 2026 for solutions that include expanding medical and nursing education, improving training quality, and creating incentives for professionals to serve in underserved regions. Equally important are measures to address burnout, workplace safety, and mental well-being of healthcare workers. A strong healthcare system cannot exist without a supported and motivated workforce.
Boost to Digital Health and Innovation
Digital health has emerged as a powerful enabler of access, efficiency, and transparency. Telemedicine, electronic health records, AI-based diagnostics, and digital health platforms have demonstrated their potential to bridge gaps in care delivery.
The health sector expects Budget 2026 to build on this momentum by investing in digital infrastructure, rural connectivity, and data security. Support for startups, innovation hubs, and indigenous development of health technologies is also a key demand. A well-regulated and inclusive digital health ecosystem can transform healthcare delivery, especially in remote and underserved areas.
Support for Medical Research and Indigenous Manufacturing
India’s ambition to become a global healthcare and life sciences hub depends heavily on research, innovation, and domestic manufacturing. However, funding for medical research and clinical trials remains limited.
From Budget 2026, the sector expects increased allocation for research institutions, public-private collaborations, and innovation-driven initiatives. Incentives for indigenous manufacturing of medical devices, diagnostics, and pharmaceuticals are also critical to reduce import dependence and ensure supply chain resilience. Investing in research today will pay dividends in better treatments, lower costs, and global competitiveness tomorrow.
Mental Health as a Budget Priority
Mental health challenges have grown significantly in recent years, yet services remain inadequate and inaccessible for large sections of the population. The health sector believes it is time for mental health to move from the margins to the mainstream of healthcare planning.
Budget 2026 is expected to allocate dedicated funds for mental health infrastructure, training of professionals, community-based counselling, and integration of mental health services into primary care. Addressing mental health holistically will not only reduce disease burden but also improve productivity and social well-being.
Pandemic Preparedness and Public Health Security
Recent global health crises have underscored the importance of preparedness. The health sector wants Budget 2026 to strengthen disease surveillance systems, laboratory capacity, and emergency response mechanisms.
Investment in public health intelligence, rapid response teams, stockpiles of essential supplies, and clear funding protocols for emergencies is crucial. A proactive approach to public health security can prevent disruptions and save lives during future outbreaks.
Creating a Stable and Predictable Policy Environment
Beyond financial allocations, the health sector is also seeking policy stability and regulatory clarity. Frequent changes, complex compliance requirements, and uncertainty can discourage investment and innovation.
Healthcare stakeholders expect the Finance Minister to signal a long-term commitment to health sector reforms, with predictable policies that encourage both public and private participation. Collaboration between government, industry, and medical professionals is essential to achieve shared health goals.
A Budget That Reflects Healthcare’s True Value
At its core, the expectation from Budget 2026 is simple yet profound: healthcare should be treated as an investment, not a cost. A healthier population drives economic growth, reduces inequality, and enhances national resilience.
The health sector is not looking for short-term relief alone. It is seeking a comprehensive, forward-looking budget that addresses systemic challenges and lays the foundation for sustainable healthcare delivery. If the Finance Minister can rise to this moment, Budget 2026 could mark a turning point—one that strengthens India’s healthcare system and ensures better health outcomes for generations to come.
