Healthcare Leaders Demand R&D Boost, Prevention Focus Ahead Of Budget 2026-27

India’s healthcare sector awaits transformative measures in Union Budget 2026-27, following last year’s allocation to the Ministry of Health and Family Welfare—a 10-11 per cent increase .Reports suggest public health spending hovers at 1.9-2 per cent of GDP against the 2.5 per cent National Health Policy target, with pharma R&D lagging global benchmarks and diagnostics facing inverted GST structures.

As Viksit Bharat targets a USD 500 billion pharma industry by 2047, leaders from hospitals, MedTech, and wellness outline priorities for innovation, equity, and child-centric reforms.

Pharma’s Value Shift and R&D Imperative

Pharma leaders seek structured funding to transition from volume to high-value therapies. Satish Reddy, Chairman, Dr. Reddy’s Laboratories , emphasises policy alignment. “ India’s pharmaceutical industry has built global credibility on scale, quality and affordability. As it shifts from volume-led growth to a value-driven model, tighter alignment between science, policy and industry will be essential to accelerate innovation. With the sector expected to play a key role in achieving the Viksit Bharat vision and scaling to a USD 500-billion industry by 2047, the Union Budget 2026 is anticipated to prioritise a structured funding framework to strengthen R&D and innovation nationwide. Such support would help companies translate advanced research into complex, high-value therapies while expanding patient access. Equally critical is the creation of a supportive ecosystem with sustained financing and regulatory reforms, including measures that encourage greater start-up participation, to reinforce India’s life sciences innovation landscape,” Reddy states.

Echoing this, Ashok Nair, MD, RPG Life Sciences, highlights export and compliance needs. Nair remarks, “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 rationalise logistics costs, and faster approvals are essential.”

Hospitals and Prevention: Child Health, Seniors, Digital Push

India’s paediatric healthcare, which serves nearly 25per cent of the population under the age of 14 (Census 2021), receives only 0.33per cent of GDP—down from 0.34per cent as per the MoHFW Demand for Grants 2025–26. At the same time, demand for senior care is projected to rise by 300per cent by 2030, with the elderly population expected to reach 138 million (NITI Aayog Ageing Report 2023). This widening care gap is pushing hospitals demand to prioritise both child and geriatric services, alongside stronger investments in digital and preventive healthcare.

Healthcare leaders are calling for a more future-focused approach in the Union Budget 2026, with sharper emphasis on children, prevention, senior care, and technology.Dr. Ramesh Kancharla, Founding Chairman, Rainbow Children’s Medicare, stresses the need for stronger paediatric investment, noting that while child-welfare allocation has marginally risen to 2.29 per cent of the Union Budget, its share of GDP has fallen to 0.33 per cent. For a country with a large paediatric population, he says this is inadequate and calls for a long-term goal of raising child-focused spending towards 5 per cent of GDP, with a major share directed at child healthcare.

Shobana Kamineni, Promoter Director, Apollo Hospitals Enterprise and Executive Chairperson, Apollo Healthco, highlights prevention as the foundation of a Viksit Bharat. With nearly one billion Indians expected to form the workforce by 2047, she advocates a prevention-first system driven by mandatory health check-ups, digitised records and seamless data portability to enable early risk detection and long-term productivity at scale. Rajagopal G, Co-Founder, Director & Group CEO, LifeBridge Group, draws attention to India’s ageing population, calling for an integrated senior care policy that brings together healthcare, housing, financial security and workforce development. He notes that Budget 2026 offers a critical opportunity to recognise senior care and senior living as a distinct and essential sector.

Dr. Sajeev Nair, Founder and Chairman, Vieroots, urges policy and fiscal support for AI-driven wellness, digital diagnostics and personalised care solutions, as India shifts from reactive treatment to preventive and predictive healthcare. Adding to this, Masaharu Morita, Founder and Program Director, NURA – AI Health Screening Centre, underscores the importance of prevention and early intervention, warning that non-communicable diseases continue to rise while many remain undetected until advanced stages.

MedTech Self-Reliance And AI Infrastructure

Healthcare and life sciences leaders are calling on Budget 2026–27 to strengthen manufacturing, innovation and prevention as core pillars of Viksit Bharat. Emphasising MedTech manufacturing parity, Himanshu Baid, Managing Director of Poly Medicure , points out that while GST rationalisation has improved affordability, the inverted duty structure—where finished devices are taxed at 5 per cent while most inputs attract 18 per cent—has created input tax credit accumulation and significant working-capital pressures for manufacturers.

Linking technology with access and exports, Dev Tripathy, Head of Finance, Philips Indian Subcontinent, highlights that last-mile healthcare delivery depends on AI-led innovation. He stresses the need for incentives that support AI development, job creation and high-end service exports through Global Capability Centres, alongside a sustainable MedTech manufacturing ecosystem to position India as a global medical device export hub.

Building on recent progress, Shweta Rai, Managing Director India, Bayer Pharmaceuticals, notes that the previous Union Budget took important steps towards improving patient access and expresses hope that Budget 2026 will sustain this momentum by strengthening policy and funding support for pharmaceutical R&D and innovation. Complementing this, Sandeep Verma, Head of South Asia at Bayer Consumer Health, underscores the importance of continued focus on nutrition, maternal and child health programmes to improve health outcomes across all life stages.

Taken together, these expectations converge on a unified call to raise healthcare spending towards 2.5 per cent of GDP, scale up R&D investment, and integrate prevention with manufacturing self-reliance positioning healthcare as a cornerstone of India’s growth as it moves towards a USD 500 billion pharmaceutical industry and prepares to meet the needs of an ageing population.