Will Budget 2025 Finally Prescribe the Cure Healthcare Needs?
By Arunima Rajan
Experts urge tax relief, tech push, and preventive care to revitalise India’s healthcare
Dr. Harsh Mahajan Chair-FICCI Health Services Committee and Founder & Chief Radiologist, Mahajan Imaging & Labs
As we approach the 2025 budget, it’s essential to make targeted investments that will reshape the future of healthcare and diagnostics. To build a resilient and forward-thinking health system, we must prioritize technology integration, workforce development, and a strong focus on preventive care. The lessons of the COVID-19 pandemic have made it clear that digital health solutions are no longer optional—they are vital. Now is the time to invest in advanced diagnostic technologies and research. A critical area for reform is the high GST on medical equipment, which drives up costs and limits access to essential care. Reducing or exempting GST on medical devices will make cutting-edge technology more affordable for healthcare providers and ensure patients receive timely, quality care.
Moreover, offering tax incentives or rebates for companies investing in innovation will accelerate the development of life-saving technologies, enabling faster integration into the healthcare system. Alongside this, government-backed grants and public health campaigns can help shift the focus towards preventive care, ultimately lowering the long-term burden on the healthcare system. By strategically addressing these key areas, we can create an efficient, accessible, and sustainable healthcare ecosystem that improves health outcomes and reduces costs for everyone.
Chandra Ganjoo, Group Chief Executive Officer, Trivitron Healthcare
The medical device industry in India has identified some of the major expectations for the 2025 Union Budget, where it can look forward to overcoming the challenges and unlocking the growth potential. There should be a simplified regulatory framework to eliminate bureaucratic hurdles and clarify things, including a dedicated authority for medical devices distinct from pharmaceuticals. The inverted duty structure needs to be addressed to promote domestic manufacturing, whereby raw materials are charged higher customs duties than the finished products. Increasing R&D incentives and tax benefits are necessary to encourage innovation and competitiveness. Another key element is stricter enforcement of "Make in India" policies on public procurement, enhanced support for local manufacturers through reduced GST rates, and infrastructural development, such as medical device parks. More importantly, the domestic standards must be aligned with global benchmarks, thereby increasing exports and simplifying import-export procedures for a smooth supply chain. Investment in skill development and training programs and increased healthcare spending over 2.5% of GDP will create demand and strengthen the sector. If the budget addresses these expectations, it can position India as a global hub for medical devices and drive the growth of the healthcare ecosystem.
Rajiv Gupta, President of PB Fintech
With Budget 2025 approaching, the insurance sector anticipates bold reforms that will be aligned with the industry’s vision of universal insurance coverage by 2047. Tax incentives have been instrumental in driving insurance penetration all these years. We believe that with innovative tax reforms, this Budget can serve as a catalyst for creating a financially secure and insured India.
Affordability of insurance products is a key concern among low-income groups. The GST rate of 18% on insurance premiums has historically been a deterrent for many. A reduced rate would directly benefit policyholders, making insurance more accessible and affordable.
The industry strongly recommends increasing the deduction limit for health insurance under Section 80D to ₹50,000 for individuals and ₹1,00,000 for senior citizens. Furthermore, introducing tax exemptions for contributions to Health Savings Accounts can empower individuals to manage escalating healthcare costs more effectively.
Providing tax benefits for life and health insurance policies with tenures exceeding 10 years will motivate individuals to commit to long-term financial planning.
Ms Ameera Shah, Promoter and Executive Chairperson, Metropolis Healthcare Ltd.
The diagnostics sector plays a pivotal role in the healthcare ecosystem, enabling timely detection and precise treatment planning. The forthcoming budget presents an opportunity to strengthen this critical segment further. To enhance the quality and credibility of diagnostic services nationwide, we urge the government to implement a robust policy framework that standardises practices and mandates NABL accreditation for every laboratory operating in India.
We strongly advocate for the introduction of 0% GST on diagnostic services and refunds for GST paid on inputs. Additionally, increasing incentives for research and development in diagnostic technology will foster innovation and position India as a global leader in healthcare advancements. Other key measures include raising the tax exemption for preventive health check-ups from the current ₹5,000 to ₹10,000, extending this benefit to multiple family members, and incorporating reimbursements for outpatient diagnostic services within insurance packages. Simplifying regulatory processes and introducing a single-window clearance system will also improve the sector's business environment.
As the diagnostics industry continues to expand globally, these measures are essential for driving growth and positioning India as a global leader in healthcare advancements. We remain committed to collaborating with the government to achieve these shared objectives and unlock the full potential of the diagnostics sector.
Dr. Vidya V Bhat, the Medical Director of Radhakrishna Multispeciality Hospital in Bengaluru.
As specialists in women’s healthcare, we urge the government to prioritize investments in maternal and reproductive health in the upcoming budget. Strengthening access to affordable and quality gynecological care is critical for improving women’s overall health and ensuring safe pregnancies and deliveries.
We hope the budget allocates greater resources toward expanding infrastructure for maternal health in rural and semi-urban areas, improving training for healthcare providers, and subsidizing essential screenings for conditions like cervical cancer and polycystic ovary syndrome (PCOS).
Additionally, enhancing insurance coverage for fertility treatments and gynecological surgeries, as well as funding awareness campaigns on menstrual health and contraceptive options, cervical cancer vaccine awareness can significantly empower women across all socio-economic groups.
An increased focus on women’s health is not only a matter of equity but also an investment in the health of our families and future generations. We look forward to seeing a budget that prioritizes women’s well-being as a cornerstone of India’s healthcare system.
Dr. Anand. K, MD & CEO, Agilus Diagnostics Ltd.
India's healthcare infrastructure continues to face significant challenges when compared to established markets. For instance, the number of hospital beds per 1,000 population remains well below the WHO target of 3, highlighting the urgent need for capacity expansion. Similarly, diagnostic test penetration per capita lags behind other leading nations, presenting a critical opportunity to strengthen this sector. We urge the government to prioritize investments in healthcare infrastructure, particularly in expanding hospital bed capacity and enhancing diagnostic services. Targeted funding and policy incentives can help bridge these critical gaps, ensuring equitable access to quality healthcare for all.Government healthcare expenditure as a percentage of GDP in India is lower than that of other countries. However, the upward trajectory—with projections of reaching 3.2% of GDP by FY33—is encouraging. We hope this year’s budget allocates a substantial increase in healthcare spending to address these gaps and further drive accessibility and affordability. Currently, there are no minimum standards governing diagnostic laboratories in India, resulting in inconsistencies that hamper growth and delay effective patient management due to unreliable diagnostic results. Moreover, the country faces a severe shortage of pathologists, with many towns relying on a single pathologist. We recommend the establishment of a regulatory framework, including an official council to accredit experienced and qualified medical laboratory technologists, empowering them to sign off specific lab reports. This would ensure uniform standards, improve diagnostic reliability, and address the pressing shortage of pathologists, especially in underserved areas.
India is undergoing demographic shifts, with the share of individuals aged 60 and above expected to reach approximately 13% by CY31. Simultaneously, non-communicable diseases are projected to account for ~74% of deaths by CY30. These trends emphasize the urgent need for robust policies that focus on preventive healthcare and large-scale population studies. Such measures could mitigate the significant economic losses caused by NCDs and improve overall health outcomes. Currently, Tier 1 and Tier 2 cities house about 67% of India’s pathology network, leaving Tier 3 cities and rural areas underserved. This disparity often leads to delayed diagnoses and treatments in less urbanized regions. We urge the government to prioritize funding for large scale public-private partnership (PPP) projects, enabling advanced diagnostic services to reach underserved rural populations. Such initiatives could significantly transform healthcare delivery in these regions and address the stark accessibility gap. Precision diagnostics are revolutionizing patient care, enabling better-targeted therapies and improved recovery rates. However, these technologies are often imported, leading to higher costs. Reducing custom duties on the import of diagnostic equipment and kits would enhance accessibility and efficiency. Additionally, offering input tax credits for GST would alleviate the cost burden for the healthcare sector, fostering increased investment in R&D and innovation. As a key player in India’s healthcare ecosystem, we at Agilus Diagnostics remain committed to supporting these advancements.
Harish Trivedi, CEO, CTSI – South Asia
The Union Budget 2025 offers a transformative opportunity to address critical gaps in the Indian healthcare system and propel it toward a future of inclusivity, innovation, and efficiency. One of the most pressing needs is the enhancement of healthcare accessibility in remote and underserved regions. We strongly advocate for increased investment in teleradiology services, which can provide timely and accurate diagnostic solutions to patients in rural and remote locations, bridging the gap caused by a shortage of specialized healthcare professionals.
Additionally, integrating Artificial Intelligence (AI) into healthcare holds immense potential to redefine patient care and outcomes. AI-driven predictive analytics can play a crucial role in early detection of diseases, such as predicting cancer probabilities in high-risk patients, enabling timely intervention. Furthermore, AI can optimize radiation therapy by identifying and protecting organs at risk during treatment, ensuring both precision and safety. Beyond this, incorporating AI into health equipment and diagnostic machines can enhance efficiency, reduce errors, and enable better clinical decision-making across healthcare facilities.
Investments in telemedicine infrastructure are equally critical. Expanding telemedicine services can make quality healthcare accessible in Tier 2 and Tier 3 cities, reducing the dependency on urban centers and easing the burden on tertiary care hospitals. Strengthening healthcare infrastructure in rural areas, including better-equipped primary healthcare centers, will create a solid foundation for addressing the needs of millions who currently lack adequate medical support.
To achieve these ambitious goals, it is essential for the upcoming budget to prioritize strategic funding in advanced technologies, skill development for healthcare professionals, and infrastructure development. Budget 2025 holds immense potential to transform India’s healthcare landscape by creating an ecosystem that fosters innovation, expands accessibility, and ensures quality care for all.
Vikrant Agrawal, Care.fi , Co-Founder
As we approach the interim budget announcement, we at Care.fi are hopeful for further initiatives to strengthen the healthcare ecosystem. A focused allocation for improving healthcare infrastructure, especially in underserved areas, and fostering public-private partnerships will enhance accessibility and efficiency. Schemes like Mission Indradhanush and Ayushman Bharat, which has reached 36 crore beneficiaries and authorized hospital admissions worth Rs. 1.16 lakh crore are critical, and we expect further investments to ensure universal health coverage.
India's public healthcare expenditure increased from 1.6% of GDP in FY23 to 1.9% in FY24, with plans to reach 2.5% by FY25. We anticipate further allocation to accelerate innovation and improve healthcare delivery.
We also look forward to reforms simplifying financial processes for healthcare providers. Continued support for digitization and AI-driven solutions will improve operational transparency and patient outcomes. At Care.fi, we remain committed to empowering healthcare workers through smarter financial solutions.
Dr Puneet Khanduja, Lead Health and Nutrition practice group in India, MicroSave Consulting (MSC)
The government’s focus on healthcare over the past year, including the expansion of the PMJAY scheme and the launch of various digital health initiatives, has been commendable. However, much work remains in addressing the healthcare needs of underserved populations, particularly women and the elderly. To build on this momentum, the upcoming Union Budget should prioritize targeted investments in rural healthcare infrastructure and specialist care facilities for women and the elderly. A greater allocation for mobile health units, telemedicine, and community health worker programs can significantly improve accessibility in remote areas. Additionally, increasing funding for nutritional support programs for vulnerable communities will ensure holistic health outcomes. Strengthening public-private partnerships and incentivizing healthcare innovation will further streamline service delivery. By increasing the budgetary focus on these areas, India can make significant strides in bridging healthcare gaps and improving the quality of life for its most vulnerable citizens
Mr. VS Sudheer, Group CEO, Maxivision Super Specialty Eye Hospital
With nearly 40% of India’s population requiring primary eye care services annually—ranging from optical corrections to advanced surgeries—it is imperative to address the gaps in access and affordability. Advanced eye care services are still concentrated in Tier 1 cities, forcing Tier 2 and Tier 3 populations to travel long distances for specialty care. This disparity is particularly concerning as the 50+ age group, which will soon make up 50% of India’s population, drives a surge in demand for cataract and diabetic eye care services.
Private players dominate advanced eye care due to quick ROI in metro regions. To expand into underserved areas, the government must incentivize investments in Tier 2 and Tier 3 towns through subsidies for equipment, real estate, and streamlined approval processes under government schemes. Simplifying compliance and ensuring timely reimbursements under programs like PMJAY will encourage greater participation from private providers.
High import duties on advanced technology and equipment make treatments costly. Lowering these duties or promoting domestic manufacturing through Make in India can significantly reduce costs. Supporting R&D, cross-border alliances, and skill development programs will help Indian manufacturers meet international standards and foster innovation.
India faces a critical shortage of trained ophthalmologists, with only 20,000 practitioners serving a vast population. Of these, only a fraction is equipped to perform advanced surgeries. Subsidized training programs and mandatory skill-building initiatives for private institutions can help bridge this gap.
AI-driven solutions hold immense potential for preventive eye care. India, with its vast data pool, can lead the way in predictive analytics if domestic companies receive support for innovation. Finally, broader insurance coverage, subsidies on essential imports, and environmental initiatives like afforestation will ensure affordable, sustainable, and equitable eye care for all.