Union Budget 2025 pleased Healthcare Leaders except for a Letdown or two

  • News
  • February 1, 2025

New Delhi: Healthcare leaders expressed overall satisfaction over Union Budget 2025 except for a letdown or two. Rajiv Nath, Forum Coordinator, Association of Indian Medical Device Industry (AiMeD), though appreciated the overall macro- economic and policy directions contained in the budget, he felt a bit disappointed about omissions on medical device sector. On the other hand Dr Rajiv Chhibber, Vice President SMT, a stent manufacturing company, was full throated in his praise for Union Budget.

Rajiv Nath’s reaction on budget is a mixed one. In his statement, Mr Nath said, ‘There are many key features in the Budget announcements that will strengthen the economy and propel the GDP growth. Some of the important steps that are in the right directions are setting up of Manufacturing Mission and support measures for the MSMEs Startups. The measures to boost RD and innovation in the domestic industry are also a welcome move. Government’s intention to have a trust-based light regulatory mechanism and decriminalization of several laws further is also a correct and much-needed approach.’

But Mr Nath, on behalf of the medical devices industry, expressed disappointment over the fact that there is no mention of any investment promotion measures for the imports dependent sector in the main speech and had hoped that there will be some measures to boost the sector in the fine print. Mr Nath further said, ‘ The Industry is disappointed that expectations of Medical Devices sector and many of which had been supported by Dept of Pharmaceutical too as an investment enabler under the National Medical Device 2023 policy finds no mention in the speech. We were hoping to see the finance minister speak about Medical Devices as make in India enabler and address the 70% import dependence due to inadequate tariff protection with duties at zero to 7.5% in most cases and anever-rising imports bill that is expected to cross 75000 Cr Rs this year.

The Indian Medical Devices Industry’s expectations were:

1. Increase in Custom Duty to a nominal 10% to 15% (and as a Predictable Tariff Policy).
2. Correction of Inverted Duty by levying Health Cess of 5% custom duty on balance Medical Devices (In 2020 this was applied to only 5 of the 4 Digit HS Codes and balance 22 HS Codes are pending).
3. Trade Margin Capping by monitoring MRP of Imports (if found over 10 to 20 times of CIF price).
4. Income Tax benefits for CAPEX and R&D investments in Medical Devices.

‘We are however pleased to note the budget allocation for schemes to promote medical devices manufacturing has bed increased to Rs 5200 Cr up from 3300 Cr Rs.’ Mr Nath added Dr Chhibbar, on the other hand, was prolific in praise.The Union budget 2025-26 is a continuation of the efforts towards Ease of Doing Business and Ease of Living that the Modi Government committed to ensure greater prosperity and global positioning of a Viksit Bharat 2047. Finance Ministers focus on Garib, Youth, Ann daata and Nari (GYAN) with emphasis on high-end infrastructure digital development through PM GATI Shakthi, sustainability push to mitigate environmental impacts to business, domestic manufacturing with a focus on MESMEs startups, healthcare boost in the Rare Disease cancer area and supporting R&D and innovation will surely propel India towards quality manufacturing of critical drugs and medical devices. While no specific announcements were made towards the medical devices sector, however allied strategic push towards MSMEs with loan credits, availability of PM Gati Shakti Data for smoother planning of supply chains, technical skill building initiatives through Centres of Excellence and Medical Education, expansion of NHM, strengthening the shipping sector along with Udaan scheme to increase connectivity and logistic handling in aspirational, hilly and far-flung areas, along with a massive Urban Challenge Fund for transforming cities into growth hubs, expansion of Heal-in-India to push MVA, and the strategic announcement of the State Competition on Friendliness Investments will certainly have a positive catapulting impact on the sector and continue the volumetric growth of India as we inch towards a $5 Trillion dollar economy.

Sunil Agarwal, co-founder and chairman of Joy Personal Care (RSH Global) said, ‘We welcome the government’s budget for its strategic focus on economic growth through increased consumer spending power. The proposed income tax reforms are poised to enhance disposable income, driving demand across the FMCG sector, including beauty and personal care.

By prioritizing inclusive development—supporting disadvantaged groups, youth, farmers, and women—the budget strengthens purchasing power, further stimulating market demand. Additionally, initiatives aimed at boosting farm productivity, manufacturing, and exports—such as a national mission for high-yield crops and subsidized credit for farmers—will fortify supply chains and optimize input costs, ensuring long-term sectoral growth.

Taxation reforms, including potential corporate tax reductions, and streamlined tax procedures, will foster a more competitive and business- friendly landscape. Furthermore, investments in digital infrastructure, skill development, and MSME promotion will serve as key enablers of sustained consumption and economic expansion. The introduction of the National Manufacturing Mission further reinforces this vision by incentivizing manufacturing activities, enhancing production capabilities, and promoting innovation, thereby improving the global competitiveness of Indian manufacturing—a significant advantage for home-grown brands.’

Dr. Mandeep Singh Basu, Director-Dr. Basu Group said, "We are really encouraged by the recent budget, as it addresses key areas in both healthcare and MSMEs. The proposal to add 10,000 medical seats and create 75,000 over the next five years will help meet the growing demand for healthcare professionals, while the establishment of 200 cancer centers in FY 2025-26 will significantly improve cancer treatment access across the country. On the MSME front, the budget is a big boost, with the investment and turnover limits being enhanced, benefiting over 5.7 crore MSMEs that employ 7.5 crore people and account for 36% of manufacturing and 45% of exports. Additionally, the increase in credit guarantee cover for micro and small enterprises from Rs 5 crore to Rs 10 crore will make Rs 1.5 lakh crore in credit available over the next five years. This budget is truly a step forward in supporting growth and innovation in these critical sectors.

Amit Gupta, MD Founder, Leeford Healthcare, said, ‘ The Union Budget 2025 shows an improved focus on strengthening India’s healthcare system. The push towards better infrastructure, medical research, and public health programs will always be a step in the right direction for improving overall well-being. The ‘Heal in India’ initiative, backed by a Rs 20,000 crore boost for tourism, is a smart move as it will not only attract medical tourists but also showcase India as a hub for affordable, high-quality healthcare,  which has been the foundational vision of Leeford Healthcare in making healthcare accessible and affordable in every corner of the country.

Dr. Apurba Ganguly, Founder, Chairman Chief Scientist Officer -Nano Phyto Care & bioGAN said, ‘ The 2025 Budget underscores the government’s commitment to strengthening healthcare infrastructure and accessibility. At Varco Leg Care, we welcome the increased allocation towards digital health initiatives, preventive care, and medical RD. These measures will enhance patient outcomes and drive innovation in the sector. The emphasis on public-private partnerships aligns with our mission to deliver advanced, patient-centric solutions. We remain dedicated to leveraging these opportunities to expand quality healthcare access, particularly in underserved areas. This budget is a step forward in building a resilient, technology-driven healthcare ecosystem for a healthier future.

Abhi Sinha, Co-Founder, Heal Span, said, ‘ The 2025 Budget highlights a progressive approach to healthcare and insurance technology, reinforcing the need for digital transformation in the sector. At Heal Span, we applaud the government’s focus on expanding health coverage, AI-driven diagnostics, and interoperability of medical records. The push for insurtech innovation and greater accessibility to affordable policies will empower millions. Strengthening data security frameworks will also ensure patient trust in digital healthcare solutions. This budget paves the way for a more inclusive, tech-enabled ecosystem, and we remain committed to leveraging these advancements to enhance
seamless, efficient, and personalized healthcare experiences for all.

Sandesh Cadabam, Managing Director of Cadabams Hospitals, said, ‘ The Union Budget 2025 emphasis on promoting medical tourism through the Heal in India initiative is a commendable step toward positioning India as a global healthcare destination. With the medical tourism sector currently valued at approximately $9 billion, this initiative is poised to significantly enhance our healthcare infrastructure and service delivery.

We believe that a robust medical tourism framework can have a profound impact on the mental health space. By streamlining visa processes and fostering partnerships with the private sector, as outlined in the budget, we believe it will boost our efforts to attract international patients seeking specialized mental health treatments. This influx not only broadens access to quality mental healthcare but also encourages the exchange of global best practices, thereby elevating the standards of mental health services in India.

The government’s plan to add 10,000 medical seats next year, with a target of 75,000 additional seats over the next five years, is a visionary move. This expansion will address the existing shortage of healthcare professionals, including psychiatrists and mental health specialists. By increasing the availability of trained professionals, we can better meet the growing demand for mental health services and ensure comprehensive care for patients.

Mr. Saransh Chaudhary, President, Global Critical Care, Venus Remedies Ltd and CEO, Venus Medicine Research Centre, said, ‘ The Union Budget 2025 has brought several positive developments for the pharma industry, including full exemption from basic customs duty on 36 lifesaving drugs and concessional duty of 5% on 6 more. The government’s decision to fully exempt specified drugs under Patient Assistance Programmes (PAPs) and add 37 new medicines along with 13 additional PAPs will significantly improve access to critical medicines and reduce treatment costs for patients in need.

The announcement to set up Day Care Cancer Centres in all district hospitals over the next three years—starting with 200 in 2025-26—is a commendable step in strengthening cancer care infrastructure. This initiative will provide patients with first-hand assistance from healthcare professionals while easing the burden on tertiary hospitals and ensuring timely treatment closer to home.

While these are welcome steps, we had hoped for a stronger push towards pharmaceutical R&D. Increasing allocation beyond the current 1% of GDP, raising the weighted tax deduction for R&D expenditure from 100% to 200%, and swiftly rolling out the Research Linked Incentive scheme remain critical to fostering drug innovation. We urge the government to consider these priorities to further bolster research in India’s pharma industry and healthcare ecosystem.”

Related Posts

‘A Knight in Shining Armor’ packed a punch in FOGSI for Gender Equality

New Delhi: There was no fog in sight; FOGSI was shining as never before, thanks to the leadership of its outgoing president Dr Hrishikesh Pai. The over 40, 000 strong…

  • News
  • December 16, 2023
  • 260 views
Women are on Trajectory to make Presence Felt in Healthcare India

New Delhi: It could be advantage patients in times to come as women as workforce are increasing in healthcare domain of India. It is given that women power blended with…

Leave a Reply

Your email address will not be published. Required fields are marked *

You Missed

Wow! What a Change of Heart in Practitioners of Allopathy!

Wow! What a Change of Heart in Practitioners of Allopathy!

GSK Pharma shares gain 20% following strong Q3FY25 results

GSK Pharma shares gain 20% following strong Q3FY25 results

Glenmark Pharma shares rise 4% on Q3 results, FY26 guidance

Glenmark Pharma shares rise 4% on Q3 results, FY26 guidance

US Tariffs on pharma: What are the potential impact on Indian drugmakers

US Tariffs on pharma: What are the potential impact on Indian drugmakers

Twin Health bats a1000 before enters Digital Health NY 100

Twin Health bats a1000 before enters Digital Health NY 100

US tariff jitters rock pharma stocks; Sun Pharma, Lupin, Dr Reddy’s slump 2-4%

US tariff jitters rock pharma stocks; Sun Pharma, Lupin, Dr Reddy’s slump 2-4%