As the Union Budget 2026–27 approaches, leaders from across India’s healthcare, pharma and diagnostics share their expectations for policy measures that can accelerate innovation, strengthen domestic manufacturing, improve affordability and expand access to quality care.
Priyanka Chigurupati, Executive Director, Granules India Limited
“As India’s role in global pharmaceutical supply chains continues to expand, this is a critical moment to strengthen our manufacturing and innovation ecosystem. In a global environment driven by supply chain de-risking and diversification, the right policy support can help India emerge as the preferred long-term alternative. A forward-looking Union Budget that improves ease of doing business, enhances manufacturing competitiveness, supports innovation ecosystem, and sharpens export-oriented policies, will reinforce India’s credibility as a reliable source of affordable medicines.”
Sheetal Arora, Promoter & CEO, Mankind Pharma
“As India finalises the Union Budget 2026–27, the pharmaceutical sector stands at a pivotal juncture expanding healthcare access at home while strengthening India’s position as a global supplier of affordable medicines. With pharma exports crossing US$30 billion in FY25 and India contributing nearly 20% of global generic medicine volumes, the industry’s scale and strategic importance are well established. 
As government health allocations, digital health initiatives and public healthcare schemes continue to drive demand for affordable therapies, this budget presents a timely opportunity to deepen support through enhanced R&D tax incentives, including the restoration of globally competitive weighted R&D deductions, expanded PLI-style measures and targeted duty rationalisation to strengthen API self-reliance. Building on the GST rationalisation measures introduced in 2025, we also look forward to a stable and predictable GST framework that addresses inverted duty structures, recognises the unavoidable nature of medicine expiry, quality and safety requirements, and enables smoother cost pass-through across the pharma value chain.
Fast-tracking capacity creation for regulated markets such as the US and EU, supported by customs duty rationalisation for advanced manufacturing and quality compliance infrastructure, will further unlock export growth and high-quality employment, while collectively helping secure supply chains, drive innovation and reduce the cost of medicines for millions of patients across India.”
Dr G.S.K. Velu, Chairman and Managing Director of Trivitron Healthcare, Maxivision Eye Hospitals, and Neuberg Diagnostics
“As we approach the Union Budget 2026–27, India stands at a crossroad where execution must take center stage to manage our nation’s soaring Non-Communicable Disease (NCD) burden, which accounts for a mortality rate of ~65%. We urge the government to fulfil the long-standing industry recommendation of raising public health expenditure to over 2.5% of GDP to build a truly resilient and future-ready ecosystem.
Although the radical GST reform in 2025 that reduced taxes on diagnostic kits and medical devices to a mere 5% charge was a historic achievement for health equity, it is now imperative for the coming budget to correct the inverted duty structure, which has been pressurizing domestic manufacturers. There is scope to review and harmonise certain GST rates, like Radiation Protection Apparels being charged at 18% – the same should be brought under 5% GST rate for consistency. I strongly recommend aligning the GST bracket to eliminate the inverted duty structure. Such alignment would reduce operational inefficiencies, streamline compliance, and ensure that the cost savings are passed on to consumers. 
We must now ensure self-sufficiency and reduce our massive import dependency of 80% on imported devices by adopting ‘Buy India’ initiatives or boosts in research incentives like the PRIP scheme, to migrate from volume in manufacturing to depth in R&D. At the same time, reduced import duties and GST on essential ophthalmic equipment, will give a boost to preventive eye health, supported by intensive screening programmes and public-private partnerships.
The budget should provide targeted fiscal support for primary and secondary infrastructure in Tier 2 and 3 cities. In order to make affordable healthcare care accessible across Tier 2, Tier 3, and rural India, the budget should incentivise setting up of diagnostic hubs and comprehensive eye hospitals in these underserved regions through priority sector lending and enhanced Gap Viability Funding.
By integrating AI-driven diagnostics and IoT-enabled monitoring, we can transform eyecare from a reactive model to a proactive one, identifying vision impairments decades earlier. By incentivizing the integration of ‘Actionable AI’ and genomic triage into routine diagnostics, the government can help us transition from a reactive service model to a proactive, preventive healthcare system.
Only by combining high-end technology with local manufacturing and strategic infrastructure spending can we ensure that world-class quality healthcare reaches the most remote corners of the country.”
Rajiv Vasudevan, MD, CEO & Founder, Apollo AyurVAID
“Over the last few years, the government has made sustained and visible efforts to build awareness and credibility for the Ayush medical system, both within India and globally. MoAyush’s own research initiatives as well as collaborations with WHO, DBT, ICMR, etc. signal a clear intent to move towards evidence-based integration.
However, translating this intent into substantial reality shall req
uire dedicated investment commitments of the order of a minimum of INR 500 cr. per year over the next 5 years whereby robust evidence is built for Ayurveda as treatment of choice for select medical conditions starting with conditions such as Diabetes, Parkinson’s, Osteoarthritis-Knee, Lumbar Spondylosis and Sciatica in addition to gut health, sleep health, etc. This provision should be to set up a separate moonshot mission for evidence building fostering strategic public-private partnerships just as DBT has successfully demonstrated in the biotechnology sector over the last 2 decades. Not only shall this reduce healthcare spends for the Government in the medium term with elective surgery and emergency care reduced/obviated, but it will also be welcomed by society at large.
On the demand side, the Government must make a separate budgetary provision for inclusion of Ayurveda-Ayush in the ABPMJAY program. This is an imperative from the public health perspective so that effective secondary and tertiary prevention is covered and out-of-pocket expenses of the common man, currently at an estimated 48% of total spend, is significantly reduced.”
Rahul Guha, Managing Director and Chief Executive Officer
From API Holdings’ perspective –
“The government’s consistent focus on digital healthcare and startup growth has been instrumental in expanding healthcare access across India. As we approach the budget, we see exciting opportunities to further accelerate this progress.
Addressing the GST rate differential where medicines are taxed at 5% while input services attract 18% GST—would significantly improve working capital efficiency for healthcare companies. This would enable us to maintain affordability while scaling our services to reach more Indians.
As businesses adapt to evolving labour guidelines, thoughtful tax or GST measures could help ensure that compliance costs don’t impact healthcare affordability for end consumers—a 
shared priority for both industry and government.
We’re encouraged by the government’s continued commitment to the startup ecosystem. Further streamlining the ease of doing business will empower digital health platforms to innovate faster and serve millions more citizens. We look forward to a budget that builds on India’s healthcare transformation journey.”
From Thyrocare’s perspective –
“India’s diagnostics sector has seen remarkable growth, supported by progressive government policies. As we look forward to the upcoming budget, we see outstanding opportunities to further strengthen this momentum.
Aligning employee health testing with labour guidelines could be a game-changer for preventive healthcare, benefiting both employers and employees while building a healthier workforce. We also believe that streamlining compliance frameworks across entities would enhance operational efficiency and allow diagnostic players to focus more on innovation and service quality.
Extending Production Linked Incentive schemes to domestic manufacturing of diagnostic essentials—reagents, needles, and vials—would further strengthen the government’s ‘Make in India’ vision. For companies committed to local manufacturing, this support would alleviate import dependency and create a more self-reliant healthcare ecosystem. We remain optimistic that this budget will continue to prioritise healthcare infrastructure, enabling the sector to serve India’s growing healthcare needs more effectively.”
Nitin Jain, Founder and Managing Director, Iberia Pharmaceuticals.
As the Union Budget approaches, we hope that the government will extend their support to the pharmaceutical industry to help the industry grow and innovate. Despite the progress, India’s healthcare spending remains low when compared to many developing nations. The upcoming budget provides an opportunity for improvement in capabilities, maintaining a steady focus on building global standards in manufacturing, and support for research and development incentives. 
Enhanced funding and targeted measures for centres of excellence will accelerate research and innovation, driving the next phase of advancement in India’s pharmaceutical sector, thereby enhancing our scientific ecosystem, and supporting the transition from a volume-driven model to an innovation-led approach. India is well placed to strengthen its continued rise as a trusted global pharmaceutical manufacturing hub, hence the upcoming budget should streamline regulations, along with measures to promote domestic manufacturing, while ensuring that quality and safety remain paramount. Looking ahead, we expect budget 2026–27 to promote ease of doing business by simplifying compliances, prioritise long-term reforms alongside immediate capacity building and upskilling the workforce. Since the pharma sector and healthcare are increasingly becoming major growth contributors of India’s economic growth, a well-balanced budget would boost investments in the sector.
Gaurav Soni, Founder and Managing Director, Botanic Healthcare
“At a time when India is positioning itself as a global manufacturing and export hub, the Union Budget can play a defining role in elevating the nutraceutical sector from scale to scientific credibility. Strengthening support under the PLI framework, accelerating approvals in line with FSSAI’s nutraceutical regulations, and expanding incentives for clinical research under the National R&D and Innovation ecosystem would help ingredient manufacturers move up the global value chain. With export competitiveness increasingly tied to evidence, traceability, and quality, targeted support through the Foreign Trade Policy can enable Indian nutraceuticals to compete on efficacy rather than price alone. A stable and execution-focused policy environment is essential as the industry moves toward evidence-backed and personalised nutrition.”
Saransh Chaudhary: President, Global Critical Care, Venus Remedies Ltd, and CEO, Venus Medicine Research Centre (VMRC)
“Recent government initiatives such as the Research, Development and Innovation Scheme and the PRIP programme reflect a strong commitment to strengthening India’s research ecosystem and encouraging private sector investment in innovation. These measures provide an important foundation for shifting the pharmaceutical industry toward innovation-led growth.
To ens
ure these investments translate into meaningful outcomes, there is a need to further simplify the operating environment. Greater clarity and rationalisation of provisions such as Section 194R, particularly in relation to the treatment of medical samples used for patient care and clinical evaluation, would ease compliance burdens and allow companies to focus more effectively on research and development.
Reinstating a meaningful tax incentive for in-house research by restoring the weighted deduction for research and development expenditure would encourage long-term investment in complex areas such as new antibiotics, rapid diagnostics and infection control technologies. Expanding existing incentive frameworks to include critical anti-infectives, diagnostics and related active pharmaceutical ingredients would strengthen India’s preparedness against drug-resistant infections and reduce import dependence. Together, these steps can support innovation, public health resilience and sustainable industry growth.”
Dipu Bose, Head, Medical Technology, ZEISS India & Neighboring Markets
“We are optimistic that the upcoming Union Budget will introduce transformative reforms to address critical gaps in India’s healthcare access and infrastructure. The focus should be on reducing tax burdens, expanding incentives for innovation, and significantly increasing public health spending to build a more inclusive and robust healthcare system that benefits every citizen, regardless of income or location.
Expanding Production Linked Incentive (PLI 2.0) schemes for medical devices is vital to fostering innovation and reducing import reliance. Complementing this with phased manufacturing programs (PMP) and globally-aligned incentives for biosimilars, novel therapies, and research and development (R&D) will strengthen India’s healthcare ecosystem and bolster global competitiveness.
Increasing public health spending to over 2.5% of GDP is essential to improving primary care and addressing decades of underinvestment in rural healthcare. Strategic investments in district hospitals, rural facilities, and telemedicine, particularly in Tier II/III cities, will bridge healthcare gaps, reduce financial strain on lower-income communities, and ensure equitable access for all. 
India faces pressing challenges in delivering affordable and accessible healthcare, especially in underserved regions. Aligning GST rates for essential medical devices to the 5% slab and reducing cumulative taxes such as Basic Customs Duty (BCD), GST, and Health Cess will make critical medical devices more affordable for consumers, particularly in areas with limited domestic manufacturing capacity.
Simplifying import-export procedures by aligning with global best practices and reducing regulatory barriers can expedite device registration, classification, and clearances, enabling faster market entry for imported MedTech products. Implementing accelerated depreciation or tax incentives for hospitals, clinics, and diagnostic centers investing in ophthalmic equipment such as OCTs, surgical microscopes, fundus cameras, lasers, and perimeters can help offset the significant upfront costs associated with these critical investments.”
Amarendra Kumar Gupta, CFO, Sterling Hospitals
“Ahead of the Union Budget, a higher allocation for public healthcare, aligned with the National Health Policy target of 2.5% of GDP, will strengthen care delivery and ease operational pressures. Increased outlay for Ayushman Bharat can help streamline reimbursements and improve system efficiency. Incentives for private hospitals, indigenous medical devices, AI-enabled healthcare, and faster clearances for domestic drug and vaccine development will support capacity building, reduce costs and improve affordability for patients across the country.”
Shreehas Tambe, CEO & Managing Director, Biocon Biologics
“India stands at a pivotal moment as it evolves from being a global supplier of
affordable generics to a leading hub for pharmaceutical innovation and advanced
manufacturing. The Union Budget 2026 offers a strategic opportunity to accelerate
this transition and strengthen India’s position in the global pharmaceutical value
chain.
The Government’s announcement of the ₹1 lakh crore Research, Development and Innovation (RDI) Fund is a significant and welcome step. To fully realise its potential for the pharmaceutical sector, this initiative must be supported by enabling fiscal and regulatory measures that improve investment viability, reduce input costs and incentivise high-risk research. The Union Budget 2026 is an opportunity for the government to prioritize certain key interventions:
1. Restore weighted tax deductions for pharmaceutical – to stimulate sustained investment in novel drugs, biologics, biosimilars, peptides, complex generics, and platform technologies;
2. Provide targeted customs duty relief on critical APIs, intermediates, reagents,
analytical instrumentation, and process equipment to enhance cost competitiveness
and supply chain resilience;
3. Rationalise inverted GST structures impacting APIs, formulations, and clinical
research services to improve cash flows and pricing efficiency;
4. Introduce focused incentives for advanced pharmaceutical manufacturing,
including biosimilars, peptides, biologics, cell and gene therapies, continuous
manufacturing, and green chemistry–based production.
These measures will catalyze private investment, accelerate the translation of
research into commercial therapies, and support the development of globally
competitive pharmaceutical manufacturing capabilities in India.”
Ashok Nair, MD, RPG Life Sciences
“The Indian pharmaceutical sector is at the cusp of a new era. As our portfolios shift towards complex generics and biosimilars, margin profiles will improve, boosting India’s position as a global hub for affordable pharmaceuticals.
Today global companies are seeking more CDMOs in search of efficiency, with AI-assisted discovery and documentation, even as key markets like US are focusing on robust compliance and regulation. Indian pharma exports growth in the near future is likely to come from a mix of US and fast-growing emerging markets.
To support export growth and regulatory excellence, targeted government support to rationalize logistics costs, and faster approvals are essential. Expedited CDSCO approval timelines and a single-window mechanism for clinical trials, exports related clearances, and plant clearances will accelerate market access domestically and internationally.
RPG Life Sciences welcomes continued government support for innovation, competitiveness, and sustainability. Incentives and weighted tax deductions for R&D investments in complex generics, injectables, and biosimilars will be key to develop cutting-edge therapies.
We advocate for an expansion of Production-Linked Incentives to cover critical intermediates and biosimilars, alongside strategic encouragement of domestic API manufacturing to reduce import reliance and strengthen supply chains.
Furthermore, a strong emphasis on digital health, pharmacovigilance, and digital-first quality systems can be transformative for the sector’s future readiness. Sustainability commitments such as energy efficiency, solvent recovery, and green chemistry are increasingly becoming standard priorities across the industry. Companies are also strengthening global regulatory compliance for USFDA and EU markets, while near-shoring supply chains and localizing API production to mitigate systemic risks.
As we look ahead, the Indian pharmaceutical industry is poised to lead not just in scale, but in complexity, quality, and innovation. With the right policy interventions in the upcoming Union Budget, the sector can accelerate its journey toward global leadership in healthcare.”
Bhavin Bhagat, Chief Financial Officer, CORONA Remedies Limited
“As India continues to establish itself as a global supplier of high-quality medicines, innovation backed by strong research and development will be the true differentiator for the pharmaceutical sector. The Union Budget 2026–27 presents a critical opportunity to reinstate and strengthen R&D-linked incentives, including enhanced weighted deductions, which can meaningfully accelerate innovation-led growth for Indian companies. Additionally, as advanced technologies such as artificial intelligence become integral to drug development, manufacturing efficiency, and quality outcomes, targeted policy support and fiscal incentives for AI adoption will be essential. Enabling access to these technologies will empower Indian pharmaceutical companies to fully leverage the country’s technological capabilities and compete at the global forefront of science-driven healthcare.”
Mohan Jain, Director, Naprod Life Sciences Pvt Ltd
“As we approach Union Budget 2026, the pharmaceutical sector looks forward to policy measures that strengthen India’s position as a global hub for high-quality, specialty medicines. Continued focus on advanced manufacturing—particularly in complex therapy areas like oncology, injectables, and critical care—will be pivotal for sustaining India’s trust capital across regulated and emerging markets.
From an industry standpoint, the biggest lever is to make compliance-led manufacturing easier to scale—through sharper support for technology upgradation, quality infrastructure, and R&D. A meaningful step would be to strengthen innovation incentives, including a more competitive R&D tax framework, while also expanding manufacturing-linked support to critical inputs such as APIs to improve supply-chain resilience.
Equally important is improving export competitiveness by easing structural friction points—faster trade facilitation and a GST/ITC framework that reduces working-capital lock-ups for export-oriented manufacturers. Better access to affordable credit and continued momentum on export credit support can further enable responsible capacity expansion without diluting quality benchmarks.
A forward-looking budget that prioritises innovation, manufacturing resilience, and ease of doing business will help Indian pharma move from ‘volume to value’—and reinforce India’s role as a trusted global partner in delivering affordable, life-saving therapies.”