Finance Minister Nirmala Sitharaman will present the Union Budget for the financial year 2025-26 on February 1. The government is continuously increasing its focus on the health sector. In such a situation, experts believe that this time the allocation for major sectors like health in the Budget can be increased by about 10 per cent. Also, there is a demand for uniform GST on medical devices. In the Budget last year, the Finance Minister had given Rs 90,958 crore for health.
According to National Health Accounts estimates, India’s share of healthcare expenditure has declined from 64.2 per cent in 2013-14 to 39.4 per cent in 2021-22, but the journey towards Universal Health Coverage (UHC) remains challenging. Public healthcare expenditure has increased from 1.13 per cent of GDP to 1.84 per cent in the same period. However, experts believe that this is far from the target of 3 per cent by 2030.
AI-driven solutions and robotic surgeries
With the advancement in the medical industry, India’s healthcare sector is transforming, and it has presented itself in this context in such a way that the next budget is going to be a great opportunity for growth in some of the important vital areas. One of the most promising advancements is the integration of AI in diagnosing. The AI diagnostic market was last valued at USD 0.31 billion and is expected to grow to an estimated USD 2.45 billion by FY2031, with an impressive compound annual growth rate (CAGR) of 29.5%. Based on this, investments in AI-driven solutions by the government to increase diagnostic accuracy and efficiency for both patients as well as healthcare providers would surely improve total health outcomes generated across the states.
Right now, India is registering high growth in medical tourism. The filing study within CII-KPMG reveals that by 2034, the industry will have gone up to USD 50,670.5 million from USD 10,362.9 million in 2024, translating to a strong CAGR of 17.20%. For it to be durable, there must be additional factors that have been reiterated in previous cases; Processing improvement for them to come here for medical purposes will fetch more numbers of medical tourists than now.
According to Dr Simmardeep S Gill, MD & CEO of Sterling Hospitals, robotic-assisted surgery, which started its journey in 2006, has recorded all 12,800 successful surgeries. The scope for further expansion in this technology is vast; it can be worked out through subsidisation, along with the initiation of public-private partnerships aimed at enhancing paramedical skills within the country. This combined activity could enable the creation of programs of continuing education and vocational training pathways through which the workforce could be put at the disposal of advanced surgical technologies. Another development opportunity for India is in personal training, which can bring a large number of talents and potentials globally within the medical sector to absorb it.
aesthetics industry
“The aesthetics industry in India is growing fast, thanks to various government initiatives, and the right steps can help it grow even more., For the 2025 Union Budget, we hope to see measures that will further boost the sector and make treatment advances accessible. to more people. Supporting research and development should be a priority. Setting up research hubs or providing funding for innovation can help create safer and more affordable treatments tailored to Indian consumers. Faster approvals and clearer guidelines would allow clinics to integrate advanced solutions efficiently, ensuring patients benefit from the latest developments, said Amit Shukla, General Manager and Head of Indian Operations at Alma Medical Private Limited.
“We also recommend offering tax benefits to businesses in this sector, particularly those expanding to smaller cities. Similarly, lowering GST on equipment used in aesthetic treatments would reduce costs, making these procedures more affordable for both providers and consumers. Another critical area is training. Aesthetic procedures require skilled professionals who can operate modern equipment and deliver reliable results. the government can help the aesthetics industry grow stronger, improve accessibility, and position India as a global leader in advanced treatments,” he also added.
Public healthcare infrastructure
“I urge the government to allocate increased funding for public healthcare infrastructure and offer tax incentives, especially for hospitals that are part of the Ayushman Bharat Yojana. Additionally, subsidized training programs for surgeons and public-private partnerships in medical innovation can ensure advanced treatments reach more patients. Awareness campaigns for early detection and prevention of cancer should also be prioritized. These measures will advance healthcare accessibility, improve outcomes, and align with India’s goal of being a global leader in medical innovation,” said Dr Raj Nagarkar, Managing Director & Chief of Surgical Oncology & Robotic Services, HCG Manavata Cancer Center (HCGMCC).
Mental health sector
In FY 2025–2026, we are expecting an adequately funded mental health budget for 2025–26. The announcement should be such that it should not only address current mental health challenges but also build a more resilient and mentally healthy society. With the growing cases of mental health, our budget must focus on the importance of mental well-being in our society. The COVID-19 pandemic has already underlined the effectiveness and accessibility of telehealth services. The government should announce some funds to amplify the reach of mental health consultations through telehealth services. This will be extremely beneficial to bridge the mental health care gap. A critical challenge is the lower doctor-patient ratio, as per Dr. Jyoti Kapoor, Founder and Director of Manasthali Wellness.
Given the current ratio of 1 psychiatrist per 100,000 patients, strengthening India’s mental health workforce should be an urgent priority. Increasing the number of trained professionals is the need of the hour to address the rising need for mental health services. The shortage of mental health professionals can be addressed through targeted skill development programs. Furthermore, the government should announce widespread public health awareness campaigns on mental well-being to combat stigma and prioritize community-based mental health services.
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