The Union Budget for 2025-26, presented by Finance Minister Nirmala Sitharaman, marks a pivotal moment for India's healthcare sector, with major initiatives aimed at boosting medical tourism, enhancing healthcare infrastructure, and increasing the workforce.
On February 1, 2025, during her budget address, Sitharaman announced nearly Rs 1 lakh crore allocated for healthcare, reflecting almost an 11 percent increase from the previous fiscal year. The healthcare funds are divided between Rs 95,957 crore for the Department of Health and Family Welfare and Rs 3,900 crore for Health Research. This increase aligns with the government’s vision of making India a global hub for medical tourism.
Central to this vision is the ‘Heal in India’ initiative, which aims to simplify visa processes for international patients and promote services provided by the private sector. Currently, India is the 10th most popular destination globally for medical tourism, attracting around two million patients annually from 78 countries for various treatments, including wellness and reproductive health care.
“The push for promoting medical tourism under the ‘Heal in India’ initiative is aimed at elevifying India’s position as a global healthcare destination,” stated Raj Gore, CEO of Healthcare Global Enterprises Limited. Acknowledging the significance of improved visa procedures and enhanced partnerships with the private sector, he underscored how these measures could attract more international patients, thereby benefiting India's healthcare system and economy.
Experts believe the economic potential of medical tourism is significant, projecting it could yield substantial revenue for hospitals and healthcare institutions. This influx of international patients can bolster healthcare infrastructure, lead to advancements such as AI diagnostics, robotic surgeries, and modern treatment centers.
“Indian hospitals offer high-quality care with excellent outcomes at significantly lower costs than those found globally,” noted Dr. Sangita Reddy, Joint Managing Director of Apollo Hospitals. She highlighted the need for improved flight connectivity and efficient visa processing to fully leverage this opportunity, emphasizing the advantages India has over competing medical tourism destinations.
To support this growth, Sitharaman announced plans to add 10,000 medical school seats this coming year, with the goal of increasing the total by 75,000 over the next five years. This measure will directly address workforce needs within the healthcare sector, which is experiencing significant demand.
The budget also outlines the establishment of 200 daycare cancer centers across district hospitals by 2025-26, enhancing access to cancer care throughout the country. The initiative aims to democratize cancer treatment and improve outcomes for patients who may otherwise be underserved.
Beyond these specific initiatives, the government has pledged to expand broadband connectivity to primary health centres, enhancing telemedicine capabilities to reach rural populations. Sitharaman reinforced the importance of digital infrastructure as foundational for improving healthcare delivery and access.
The healthcare budget even extends to supporting gig workers under the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY), ensuring approximately 10 million gig workers can access healthcare coverage. This initiative signifies the government’s recognition of the changing workforce dynamics and their importance to health provision.
Industry responses to the budget have largely been positive. Joy Chakraborty, COO of P.D. Hinduja Hospital, expressed optimism about the substantial allocation and visionary program for the establishment of medical centers, stating this initiative will streamline cancer care delivery.
Vikram Thaploo, CEO of Apollo Hospitals Enterprises, praised the budget as progressive for enhancing accessibility and affordability within the healthcare system. He highlighted how establishing medical tourism as part of governmental strategy is set to improve service delivery and bolster India’s standing as a global healthcare leader.
Dr. Krishna Prasad Rao Vunnam, founder of Ankura Hospitals, stressed the importance of ensuring access to quality healthcare for Indian citizens, even as the focus broadens to include international patients. He outlined the potential risk of prioritizing medical tourism to the detriment of local healthcare services.
The budget's dual focus on improving patient experiences for domestic healthcare users and attracting international patients is both ambitious and necessary. With India's demographic advantages of trained professionals and cost-effective care, it stands at the threshold of becoming the preferred global destination for medical tourism.
The commitment to facilitating easier visa norms for medical tourists is intended to remove barriers and catalyze patient flow. Medical institutions will need to establish operational frameworks catering to both international and domestic patients, ensuring excellence across the board.
Notably, the exemption of customs duties on 36 life-saving medications and the introduction of patient assistance programs will reduce healthcare costs and improve treatment access.
Overall, the 2025-26 Union Budget prominently prioritizes initiatives aimed at enhancing India's healthcare sector resilience, showcasing significant investment and strategic expansions. With the collective efforts of policymakers, healthcare providers, and stakeholders, India is poised to make substantial advancements toward becoming the world's preferred healthcare destination.