Just 10 days left before the Finance Minister presents the Budget in the Parliament on February 1. Different sectors have different expectations and the health care segment is no exception. Deeper focus on R&D in healthcare ranks high up in the health sector’s wishlist.
Additionally, encouraging participation from start-ups, focus on domestic manufacturing, and ensuring a sufficient child welfare budget are some of the key demands from the health sector. The challenges arising from Trump tariffs and ways to mitigate and minimise the impact also configure prominently in the Budget wishlist.
FinancialExpress.com spoke to a host of industry stakeholders , here’s what they have to say-
1. Dr Reddy’s Laboratories calls for stronger R&D funding and start-up participation in Budget
According to Satish Reddy, Chairman, Dr. Reddy’s Laboratories, the budget will focus on creating a structured funding framework for deepening innovation and R&D in India’s pharmaceutical sector.
“This would enable companies to translate advanced research into complex, high-value therapies while improving patient access,” he added.
He has also emphasised that sustained financing for innovation in the pharmaceutical sector remains important, adding that regulatory reforms to encourage participation from start-ups can play a crucial role in the country’s life sciences innovation ecosystem.
2. Indian Pharmaceutical Alliance seeks R&D push, GST reforms amid global challenges
Sudarshan Jain, Secretary General of the Indian Pharmaceutical Alliance said that, “India’s pharma sector is well positioned to achieve its target of reaching $120–130 billion by 2030.” He says that recent global challenges such as US tariffs, supply chain disruptions, and geopolitical uncertainties underline the need to strengthen the country’s competitiveness in this sector.
The industry leader recommends that India should strengthen its R&D model and transition towards a more innovation-led model.He believes “Restoring it under the new Income Tax Act would significantly boost investment in novel drugs, complex generics, biosimilars, and vaccines.” He added that supporting manufacturing competitiveness via the rationalisation of the GST structure, ensuring smooth GST refunds, and reintroducing concessional tax regimes for new facilities will help strengthen the sector.
Additionally, simplification of the regulatory framework and increasing government healthcare spending towards the National Health Policy 2017 can help boost the overall healthcare landscape.
3. Rainbow Children’s Medicare recommends increasing spending in child welfare budget
Dr. Ramesh Kancharla, Founding Chairman of Rainbow Children’s Medicare, has said that the forthcoming budget needs to focus on expanding the child welfare budget. “Despite a marginal rise in the child-welfare budget to 2.29 per cent of the Union Budget, its share of GDP has slipped from 0.34 per cent to 0.33 per cent,” Kancharla said in a note.
He added that increasing the number of postgraduate training positions in paediatrics, along with tax deductions for essential check-ups and expanding the network of dedicated paediatric hospitals, will help improve the overall sector.
4. Metropolis Healthcare recommends prioritising preventive and holistic healthcare
Projections show that non-communicable diseases are expected to account for nearly 75% of morbidity and mortality by 2030. As the cost of NCDs is estimated at $6 trillion,
Ameera Shah, President, NATHEALTH, and Promoter and Executive Chairperson, Metropolis Healthcare, says that the country must pivot towards a prevention-led healthcare system.“Union Budget 2026–27 presents a timely opportunity to strengthen healthcare as national infrastructure through long-term affordable financing, create an NCD resilience fund by earmarking a portion of the health cess and universal CSR obligations, and expand access to quality diagnostics through a national network of NABL/ISO-accredited reference laboratories,” Shah added.
5. Poly Medicure bets on GST inversion, seeks R&D and export push in Budget
Himanshu Baid, Managing Director, Poly Medicure, highlighted that the GST duty structure currently levies 5% tax on many finished devices, while most inputs and input services attract an 18% duty, which leads to the accumulation of large input tax credits and high working-capital pressures for manufacturers.
“Addressing this imbalance is essential. Aligning the job-work GST rate for medical devices with the concessional 5% applied in the pharmaceutical sector and revising the refund formula to include ITC on input services and capital goods would offer immediate relief and bring greater parity across the healthcare manufacturing ecosystem,” Baid said in a note.
He also recommends a MedTech Export Acceleration Mission, which could further bolster India’s position globally as a trusted source of high-quality, affordable medical devices.
6. Philips expects Budget to prioritise AI-led healthcare
Highlighting the importance of AI in early diagnosis, Dev Tripathy, Head of Finance, Philips Indian Subcontinent, said that incentives for innovation in AI in the healthcare sector must be prioritised.
“To establish India as a medical device export hub, we need a sustainable ecosystem for MedTech manufacturing. New PLI schemes should encourage holistic development, ensuring comprehensive growth across the industry,” Tripathy added.
Overall the healthcare industry highlighted the need for focused spending on R&D in the sector and also establishing India as a medical devices hub.