India’s ambition to become a global healthcare powerhouse took center stage in the Union Budget 2025-26, unveiled on February 1 by Finance Minister Nirmala Sitharaman. With a record ₹98,311 crore earmarked for healthcare, the budget delivers a decisive push toward medical education expansion, cancer care infrastructure, and game-changing tax exemptions on life-saving drugs. Packed with critical reforms, it signals a bold move to reshape the nation’s healthcare landscape and strengthen its position on the global stage.

Key Highlights 

Medical education: Enhancing healthcare workforce

In the fiscal budget 2025 - 26, the Finance minister stated that across the past three years 1.1 lakh under graduate and postgraduate medical education seats were added which represented a 130% increase. To further strengthen the healthcare workforce, she proposed that 10,000 additional seats will be added in medical colleges and hospitals. Ms Sitharaman also went on to add that the government would work towards a goal of adding 75,000 seats to medical colleges in the next 10 years. 

Cancer Care Centers: Expanding Lifesaving Facilities

Addressing India’s rising cancer burden, Sitharaman announced the launch of 200 state-of-the-art cancer care centers in district hospitals over the next three years. Additionally, relief measures for patients with cancer, rare diseases, and chronic illnesses were introduced, ensuring broader access to essential treatments.

PPP to boost the Medical tourism sector: 

In a major push to position India as a global medical tourism hub, the budget introduces an enhanced Public-Private Partnership (PPP) model under the ‘Heal in India’ initiative. This includes simplified visa norms and private sector participation, making India a preferred destination for international patients.

Life-Saving Drugs: Major Exemptions from Basic Customs Duty (BCD)

Bringing much-needed relief to patients suffering from cancer, chronic illnesses, and rare diseases, Ms.Sitharaman announced that 36 medicines and life saving drugs will be exempted from BCD, in addition to the six critical medicines that have been added to the 5% duty list, drastically reducing treatment costs.

Making Healthcare More Affordable

To cut down out-of-pocket expenses (OOPE), drugs and medicines provided under pharmaceutical companies’ patient assistance programs will now be fully exempted from BCD, provided they are given free of cost to patients. Additionally, 37 new medicines and 13 patient assistance programs have been included under the exemption list.

Improved connectivity

The FM announced that broadband connectivity will be provided to primary health care centers (PHC’s).

Welfare of  Online platform workers: 

In a bid to improve healthcare accessibility and further the gig economy, the FM in her speech announced that gig workers can avail health insurance under the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY).

Allocation towards schemes 

In the union budget, Ayushman Bharat Pradhan Mantri Jan Yojana (AB PMJAY) received an allocation of Rs 9406 crores while Rs 4200 crore was allocated under the Pradhan Mantri Ayushman Bharat Health Infrastructure Mission (PMABHIM). 

The Union Budget 2025-26 underscores a strong commitment to healthcare expansion, affordability, and accessibility. Unlike previous years, this budget takes a more targeted and transformative approach, with a focus on scaling infrastructure, reducing medical costs, and fostering medical innovation. As India emerges in the post-pandemic era, these strategic investments are set to position healthcare as a key pillar of economic resilience and national progress.

With bold reforms and visionary policies, will this budget be the turning point for India’s healthcare revolution? Only time will tell.