Union Budget 2026–27: Healthcare Industry Reminds Government Of Unmet National Health Policy 2017 Target

Ahead of the Union Budget 2026–27, healthcare leaders, hospital administrators, medical professionals, and industry stakeholders have urged the Government to honour its own National Health Policy (NHP) 2017 commitment of raising public health expenditure to 2.5 per cent of GDP—a target envisioned to be achieved by 2025, but which remains unmet.

Despite repeated recommendations from the Economic Survey (2021 and 2022–23), the 15th Finance Commission, and several public policy experts, India’s public healthcare spending has stagnated between 1.5 and 2 per cent of GDP, far below the global average of around 6 per cent. Experts said the upcoming Budget is a critical opportunity to reverse this trend and address long-standing gaps in infrastructure, manpower, access, and prevention.

Dr. Aashish Chaudhry, Managing Director and Orthopaedic Surgeon at Aakash Healthcare, stressed that India needs a long-term healthcare policy anchored in sustained investment in human capital.

“India has made progress in expanding hospital infrastructure and insurance coverage, but we now need a deeper focus on healthcare policy and human resources,” he said. “The Budget should prioritise training and upskilling of doctors, nurses, and allied health staff, along with continuous medical education. Without well-trained professionals, even the best infrastructure cannot deliver quality care.”

Dr. Chaudhry also highlighted the urgent need to strengthen medical education outside metro cities, suggesting targeted incentives for teaching hospitals, simulation-based training, and stronger public–private partnerships to address workforce shortages in Tier-2 and Tier-3 regions.

Calling for decentralised healthcare expansion, Dr. NK Pandey, Chairman and Managing Director, Asian Hospital, Faridabad, said, “The Budget should encourage expansion of secondary and tertiary care in underserved regions. Tax incentives and easier access to finance for hospitals in Tier-2 and Tier-3 cities will go a long way in improving access. Preventive healthcare and early diagnosis must be integrated into primary healthcare.”

Experts pointed out that nearly 65 per cent of India’s population lives in rural areas and smaller cities, where private hospitals dominate capacity, often making healthcare unaffordable and inaccessible for large sections of the population.

On the manufacturing front, Rajiv Nath, Forum Coordinator of the Association of Indian Medical Devices (AiMeD), urged the government to raise import tariffs to 10–15 per cent from the current 7.5 per cent to support domestic manufacturing, while incentivising suppliers with over 50 per cent local value addition.

Suresh Garg, Founder and CMD of Zeon Lifesciences, emphasised strengthening India’s contract manufacturing ecosystem, especially in nutraceuticals. “Expanding PLI schemes, rationalising GST on raw materials like botanical extracts, and streamlining FSSAI approvals in line with global standards will boost domestic production and exports,” he said.

He also called for enhanced credit guarantees similar to ECLGS extensions, along with R&D tax credits for innovations in probiotics and gut health, to help MSMEs scale up and position nutraceuticals as a pillar of Viksit Bharat by 2047.

Echoing the sector’s core demand, Aman Puri, Founder of Steadfast Nutrition, said, “The healthcare sector eagerly awaits increased government allocation to healthcare to 2.5–3 per cent of GDP, which has been a longstanding demand.”

Healthcare professionals warned that chronic underinvestment has resulted in acute shortages of doctors, nurses, and hospital beds, particularly outside major urban centres. India’s doctor–population ratio, nurse-to-bed ratio, and allied health staffing levels remain well below global benchmarks.

Pavan Choudary, Chairman of the Medical Technology Association of India (MTaI), recommended expanding insurance coverage to include more effective procedures, which would improve patient outcomes and encourage responsible medical innovation, while Dr. Rajendra Patankar, CEO of Jupiter Hospital, Pune, called for a decisive shift towards prevention-led healthcare. “The focus should move from only treating illness to preventing it. Higher allocation for screening programmes, digital health records, and integrated care models can reduce long-term costs and improve outcomes,” he said.

Diagnostic providers highlighted affordability and access as key concerns. Dr. Ravi Kapoor, Founder and Director of City X-Ray & Scan Clinic, said, “Rationalisation of GST on diagnostic services and equipment will help keep tests affordable. The Budget should also support diagnostic hubs in smaller cities so patients do not need to travel long distances for basic investigations.”

Rajneesh Bhandari, Founder of NeuroEquilibrium, pointed to India’s growing MedTech potential. “With exports exceeding USD 4 billion and the sector projected to reach USD 50 billion by 2030, the Budget must create ‘clinical evidence and validation grants’ to fund multi-centre studies and real-world evidence, enabling Indian technologies to compete globally,” he said.

Dr. Vineet Malhotra, Head of Urology and Director at VNA Hospital, underlined gaps in specialist training. “There is a clear mismatch between demand and availability of trained specialists. The Budget should encourage fellowship programmes, skill-based training, and clinical research, particularly in high-burden specialties like urology, oncology, and cardiology,” he said, also advocating tax benefits on health insurance and preventive check-ups.

Prof. TV Kattimani, former Vice Chancellor of the Central Tribal University of Andhra Pradesh, called for a significant enhancement in budgetary allocation for tribal healthcare, especially for vulnerable communities such as tribes living in the Western Ghats.

He stressed the need for funding to train doctors, technocrats, and specialised health professionals who understand the unique challenges of tribal regions. “Healthcare interventions must go beyond treatment. There is an urgent need for direct financial support and sustained handholding for affected families who often face stigma and social exclusion,” he said.

Dr. NK Soni, Senior Consultant and Head of Internal Medicine and Diabetology at Yatharth Super Speciality Hospital, Greater Noida, said increased allocation for healthcare facilities, technology, and preventive services would significantly improve outcomes in Tier-2 and Tier-3 regions, while reducing the financial burden on patients. At the same time, Mansi Bansal Jhunjhunwala, Founder and CEO of MASSH Hospital, emphasised the need for greater spending on maternal health, nutrition, screenings, and neonatal care, along with investments in digital health and telemedicine.

Dr. Khyatee, a senior Physiotherapist and former Senior Research Officer at AIIMS Delhi, drew attention to rising workplace violence against healthcare professionals, calling for dedicated funding for their protection, increased medical and nursing seats, and more DNB positions, particularly in paediatrics. She also urged focused funding for senior care, early detection of gynaecological cancers, and femtech innovation.

Highlighting India’s ambition to become a global life sciences hub, Mayank Singhal, Vice Chairperson and Managing Director of PI Industries, called for enhanced R&D investments, AI-enabled research platforms, continued PLI support for APIs, and predictable, innovation-friendly policies to strengthen India’s drug discovery ecosystem.