The Union Budget 2025-26 has unveiled significant measures aimed at enhancing self-reliance in pharmaceutical manufacturing, promoting domestic production, and boosting export performance. The government has introduced several duty exemptions and infrastructure upgrades to support the growing demand for healthcare products.
Customs Duty Reforms for Critical Drugs and Medical Devices
To promote affordability and expand local production, the budget includes customs duty exemptions for key raw materials used in pharmaceuticals and medical devices. This aims to address India’s long-standing reliance on imported materials, particularly in the production of active pharmaceutical ingredients (APIs) and formulations.
The government has also reduced duties on diagnostic equipment components, facilitating increased production of medical technology and reducing operational costs for healthcare providers.
API Production and Local Manufacturing
The budget emphasizes strengthening API production to lower India’s dependency on global supply chains. By incentivizing local production and offering duty reductions on essential materials, the government aims to make India a global hub for pharmaceutical manufacturing. This is aligned with the broader goal of achieving self-sufficiency in critical healthcare infrastructure.
Pharmaceutical Export Growth
The pharmaceutical sector, a major contributor to India’s exports, continues to receive government support to expand its market reach. In FY 2024-25, pharma exports contributed significantly to foreign earnings, with further enhancements expected through the creation of export facilitation hubs and regulatory streamlining.
Support for Research and Innovation
The government has prioritized investments in research and development (R&D) for life sciences and biotechnology to enhance India’s competitiveness in high-value pharmaceutical segments such as biosimilars and vaccines. These measures aim to attract both domestic and foreign investment in cutting-edge healthcare innovations.
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Day Care Cancer Centres to Be Established Across Districts
As part of the Union Budget 2025-26, the government has announced the establishment of Day Care Cancer Centres in district hospitals nationwide. Over the next three years, 200 centres will be set up in 2025-26, aiming to provide accessible cancer care services at the district level.
This initiative is designed to decentralize healthcare infrastructure, reduce the burden on tertiary hospitals, and enhance early diagnosis and treatment options for cancer patients. It aligns with the government’s broader goal of improving healthcare access and affordability in underserved regions.
Sector Outlook
With its focus on duty reductions, self-reliance, and export facilitation, Budget 2025-26 provides the pharmaceutical industry with the tools needed to strengthen supply chain resilience and expand global market access. These measures are expected to improve both healthcare accessibility and economic growth in the coming years.
