Union Budget 2026- Here are the health highlights
Union Budget 2025 Health Highlights
Delhi: The Union Budget 2026 was declared on February 1st, with a strong push towards major health initiatives including mental health, affordable cancer and rare disease treatment, and a strategic boost to position India as a global bio-pharma manufacturing hub.
According to the announcement, the Ministry of Health and Family Welfare was allocated ₹1,06,530.4 crore in the Union Budget 2026, which is nearly a 10% increase from the budget of the fiscal year 2025-26. This move has placed India’s healthcare at the centre of development.
The latest increase in the health budget marks a cumulative rise of over 194% in health spending since 2014–15. This is a significant move towards universal, affordable, and future-ready healthcare.
One of the key highlights of this year’s budget is the sharp progress in healthcare infrastructure under the Pradhan Mantri Ayushman Bharat Health Infrastructure Mission (PM-ABHIM). The mission is allotted ₹4,770 crore, which is nearly 68% more than the previous year. The funds are said to be used for expanding critical care blocks, integrated public health laboratories, district and sub-district hospitals, and other health infrastructure facilities.
Emphasis has also been laid on the upgradation and expansion of healthcare infrastructure and medical education. The government has announced investments for the modernisation and expansion of existing healthcare facilities, as well as the expansion of trauma and emergency care services all over India.
Here are the key highlights:
- Health Budget Registers Over 194% Cumulative Growth in the last 12 years
- PM-ABHIM Allocation Surges by 67.66% to ₹ 4,770 Crore in BE 2026–27
- PMSSY Allocation for FY 2026–27 Increased to ₹ 11307 Crore, up by ₹ 407 Crore, marking a 3.73% Rise Over RE 2025–26 to Support New AIIMS, Existing Institutions, and Medical College Upgradation
- NACO Allocation Raised to ₹ 3,477 Crore in BE 2026–27, Registering 30.64% Increase; Major Boost for Blood Transfusion Services to Strengthen National Public Health Systems
- Union Budget 2026–27 Boosts Medical Research: Department of Health Research Allocation Enhanced to over ₹ 4,821 Crore, Marking 24% Increase
- ‘Bio Pharma Shakti’: ₹10,000 Crore National Initiative to Boost Biologics, Biosimilars & promote research in Pharma
- Strengthening Drug Regulation Framework through Augmentation of CDSCO Scientific Capacity
- Union Budget Focuses on Skilling Youth with Creation of Allied Health Institutions and Regional Medical Hubs
- Affordable 24×7 Emergency Care for All: Trauma Centres to Come Up in Every District Hospital
- Reduction in Customs Duty on Cancer and Rare Disease Drugs under Union budget 2026-27 to Lower Treatment Costs and Out-of-Pocket Expenditure
Boost to medical education and AIIMS network
Medical education and care have been given importance in the new budget. The Pradhan Mantri Swasthya Suraksha Yojana (PMSSY) is allotted ₹11,307 crore, which will include the establishment of new. This will also be used for the operationalisation of existing institutions and the upgradation of government medical colleges.
Adding to this, the Budget has proposed a phased ₹980-crore plan over three years to expand allied and healthcare professional education. This initiative aims to set up and upgrade Allied Health Professional Institutes in 10 key disciplines. Under this, one lakh skilled professionals are expected to be trained over the next five years through public and private sector participation. Around 1.5 lakh geriatric caregivers are also expected to be trained through a focused programme. This step is taken due to the increasing long-term care needs of India’s elderly population.
Research, biopharma, and digital health get a push
The Budget 2026–27 has also laid emphasis on research in medicine. The Department of Health Research (DHR) has been allotted ₹4,821.21 crore. Funding for the Indian Council of Medical Research (ICMR) has also increased to ₹4,000 crore.
One of the key highlights of the 2026–27 budget was the launch of a major initiative, ‘Bio Pharma Shakti’. The new initiative has been funded with ₹10,000 crore over five years to strengthen domestic production of biologics and biosimilars. It aims to build a robust ecosystem for domestic production of biologics and biosimilars, reduce import dependence, enhance affordability, and strengthen India’s position as a global biopharma manufacturing hub.
The programme aims to set up three new National Institutes of Pharmaceutical Education and Research (NIPERs) and upgrade seven existing NIPERs. The initiative will also establish a national network of 1,000 accredited clinical trial sites.
To boost digital healthcare in the country, the allocation under the Ayushman Bharat Digital Mission has increased to ₹350 crore. This will enable the expansion of digital health records, interoperability frameworks, telemedicine services, and integrated hospital information systems.
Reduction in treatment cost for patients
To reduce treatment costs, the Budget has proposed full customs duty exemption on 17 life-saving drugs, along with duty relief for medicines used in seven additional rare diseases. This step aims to reduce the financial burden, especially for cancer patients.
The National AIDS and STD Control Programme is allocated ₹3,477 crore, including a major boost for blood transfusion services to improve safety and availability nationwide.
Mental Health and Drug Regulation
With rising cases of depression and anxiety, mental health has emerged as a key focus area in the 2026–27 budget. Plans to upgrade premier institutions at Ranchi and Tezpur and establish a NIMHANS-like institute in North India have been proposed.
The government has also proposed strengthening the Central Drugs Standard Control Organisation (CDSCO) to encourage pharmaceutical research and development.
