Budget 2025: Health care gets 9.78% boost, cancer treatment costs to drop

Customs Duty exemption for lifesaving drugs, more money for Ayushman Bharat

The Centre's healthcare Budget saw a 9.78 per cent increase to Rs 99,857 crore for 2025-26, with a 28.8 per cent rise in the allocation for Ayushman Bharat-Pradhan Mantri Jan Arogya Yojana (AB-PMJAY), which is now at Rs9,406 crore. There was also relief for cancer patients with 36 cancer and rare disease drugs being exempted from Basic Customs Duty (BCD) and support for district hospitals to open cancer care centres.

 

The Department of Pharmaceuticals (DoP) received a 28.82 per cent boost, with Rs 5,268.72 crore allocated. The promotion of bulk drug parks rose from Rs 1,000 crore to Rs 1,460 crore, while production-linked incentive schemes (PLI) saw a smaller rise from Rs 2,143 crore to Rs 2,444.9 crore.

 

 

Finance Minister Nirmala Sitharaman announced plans to establish day-care cancer centres in all district hospitals within three years, with 200 centres opening in 2025-26. This initiative aims to significantly reduce out-of-pocket expenses for cancer patients. According to the National Cancer Registry Programme, cancer cases are expected to rise, with an estimated 800,000 new diagnoses annually. Experts have advocated for building capacity through a hub-and-spoke model for cancer care, with an estimated need for 10,000-15,000 more day-care beds and 25,000 surgical beds to serve all reported cancer patients.

 

Cancer treatment is set to become more affordable. Sitharaman proposed adding 36 lifesaving drugs to the list of those exempted from BCD. Another six lifesaving medicines will now be subject to a 5 per cent concessional Customs duty. These drugs include those for rare genetic disorders like spinal muscular atrophy  in children and cancer treatments like Asciminib (leukemia), with some drugs currently priced in crores. The Customs duty cuts will bring meaningful relief to patients. Currently, most cancer drugs face a 10 per cent BCD.  ALSO READ: Union Budget 2025: Where does the rupee come from and where does it go?

 

Furthermore, specific medicines supplied under Patient Assistance Programmes (PAPs) by pharmaceutical companies, including drugs for breast cancer (Ribociclib by Novartis), severe asthma (AstraZeneca’s Benralizumab), and Crohn's disease or ulcerative colitis (Takeda’s Vedolizumab), are now fully exempt from BCD. The finance minister proposed adding 37 more medicines and 13 new PAPs.

 

"By prioritising affordability and access, these initiatives not only provide critical financial relief to patients and their families but also strengthen the rare disease ecosystem in India," said Ruchi Sogarwal, director of corporate affairs at Takeda Biopharmaceuticals India.

 

Public health expert K Srinath Reddy, meanwhile, said while the Budget had several welcome initiatives to improve healthcare delivery, the National Health Mission -- the vehicle for strengthening primary care and district hospitals -- had received only a small increase. This imbalance needed to be corrected, Reddy added.

 

The Pradhan Mantri Ayushman Bharat Health Infrastructure Mission (PM-ABHIM) saw a 26.67 per cent increase to Rs 4,758 crore, with Rs 4,200 crore earmarked for centrally sponsored schemes as capex. The National Digital Health Mission (ABDM) allocation increased by a substantial 70.06 per cent to Rs 340.11 crore. The Pradhan Mantri Swasthya Suraksha Yojana (PMSSY), focused on correcting regional healthcare imbalances, saw a 10.4 per cent rise to Rs 9,940 crore, while the central hospital budget grew 4.69 per cent to Rs 4,621 crore.