Budget 2025: AI-Driven Diagnostics To R&D Push; Here’s What The Healthcare Sector Expects

Stakeholders from the healthcare sector have strong expectations for reforms aimed at tackling long-standing challenges and promoting sustainable growth

With the Union Budget 2025 set to be presented, on Feb 1, the healthcare sector is eagerly anticipating increased government support

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Union Finance Minister Nirmala Sitharaman is all set to present the Budget for the financial year 2025-26 in parliament on February 1st, 2025 and leaders across the country are sharing their take on what they are expecting from the upcoming budget. Stakeholders from the healthcare sector have strong expectations for reforms aimed at tackling long-standing challenges and promoting sustainable growth.

Over the past 15 years, India has made significant improvements in its healthcare sector through policy interventions focused on financial inclusion, nutrition, and overall well-being. However, this is not the end of the journey. Here are some of the expectations from the leaders of the healthcare sector.

Incentivise The Private Sector

Sunish Jauhari, President, Vitamin Angels India, said, “We hope that the Union Budget for FY26 will provide a further boost to key interventions such as Poshan 2.0 and Saksham Anganwadi, as well as for schemes like Jal Jeevan Mission that support overall well-being. We would also love to have an overarching Nutrition Equity Policy come into place, backed by data-based targeted deliveries to bring about nutritional equity. This becomes even more important in the backdrop of climate change induced crises that have shown to impact the disadvantaged the most. Additionally, there is room to further incentivise the private sector to invest in nutrition, fostering innovations and collaborations with the government and NGOs. A collective multi-stakeholder approach to nutrition will enable India to achieve its Sustainable Development Goal (SGD) target of Zero Hunger by 2030.” 

Increased Spending 

Highlighting the need to increased spending on healthcare, Garima Malhotra, Associate Partner, Healthcare and Lifesciences at Praxis Global Alliance, noted, “While last year’s budget saw a significant increase in healthcare spending, the sector is hoping for continued momentum towards the National Health Policy’s ambitious goal of allocating 2.5 per cent of GDP to healthcare. This year, the focus is expected to shift beyond mere allocation increases to strategic investments that can revolutionize healthcare delivery and accessibility across the nation.                      

“Digital health is another area ripe with potential. The budget is expected to further promote telemedicine and AI-driven diagnostics, enabling remote consultations and faster, more accurate diagnoses. Integrating these technologies into existing hospital workflows can significantly improve efficiency and patient care. Investments in robust digital infrastructure are also needed to ensure equitable access to these advancements across the country,” she added.

More Budget Allocation for R&D

Monica Gulati, senior Executive dean Faculty of Applied Medical Sciences, LPU, said that based on the post-COVID health aftermath, all stakeholders of the health and pharma sector are looking forward to funding for creating awareness towards dispelling myths and encouraging adoption of personal care practices by the general public at both physical as well as psychological levels, especially the elderly. 

“This will shift the general mindset from treatment to prevention and diagnosis. The other two crucial aspects where budget is required is that of the active pharmaceutical ingredients (APIs) and R&D. The Indian pharma and healthcare sector realized the bitter truth of its two decade long dependence on China for supply of APIs during COVID19. Introduction of more API manufacturing clusters, incentives to their manufacturers including tax-holiday, lower rates of income tax and regulatory support are obviously a major expectation in the upcoming budget. The other major challenge being faced is the high cost of R&D. So, initiatives in the direction of substantial funding for pharmaceutical research supporting collaboration between manufacturers, universities, and research institutions are awaited,” she added.