Sitharaman announces ₹10,000-crore biopharma push, Ayurveda expansion in Budget 2026-27; key proposals for healthcare, pharma

Finance Minister Nirmala Sitharaman on Sunday proposed a slew of measures to strengthen India’s healthcare.

Presenting the Union Budget 2026-27 in Parliament, Sitharaman proposed upgrading AYUSH pharmacies and drug testing laboratories, expanding Ayurveda education infrastructure, and a ₹10,000-crore investment push in biopharma over the next five years.

She said the government will upgrade the WHO Global Traditional Medicine Centre in Jamnagar.

The Budget also proposes setting up three new All India Institutes of Ayurveda to expand capacity for education, research and clinical practice in the sector.

Sitharaman said the government will create a network of over 1,000 accredited Indian clinical trial sites.

Major clinical trial sites in the country are currently located in big cities like Mumbai, Delhi, Bengaluru, Chennai, and Hyderabad.

The finance minister announced a loan-linked capital subsidy support scheme for veterinary colleges, hospitals and diagnostic laboratories.

The announcements come against the backdrop of rising lifestyle-related health challenges highlighted in the Economic Survey 2025-26, released on January 29.

The Economic Survey pointed out the growing anti-obesity drug market, saying that GLP-1 drugs like semaglutide were expanding rapidly, with the sector expected to grow at 25% annually through 2030.

Last year’s Budget gave a major boost to India’s healthcare and pharmaceutical sectors. The government allocated ₹99,858.56 crore for the health sector in Budget 2025, marking around 10% increase over the ₹90,958.63 crore earmarked for the previous financial year. The flagship Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB PMJAY) received an allocation of ₹9,406 crore. The government allocated ₹37,226.92 crore to the National Health Mission (NHM) for rural health infrastructure, primary healthcare services and disease control programs.

The allocations under the PLI scheme stood at ₹2,445 crore with a focus on encouraging domestic production of medicines. Customs duty on 36 life-saving drugs, along with six others, at concessional rates, was fully waived and the NPPA instructed manufacturers to pass these savings to patients.

To expand access for vulnerable groups, 37 more drugs and 13 new Patient Assistance Programs (PAPs) were launched, with medicines provided free under these programmes exempt from basic customs duty.

The Budget 2025 also proposed adding 75,000 medical college seats over five years, including 10,000 seats in FY26. The government also planned to establish 200-day care cancer centres in district hospitals within the year. The budget also set aside ₹20,000 crore for a private-sector-led research, development and innovation initiative, first announced in July 2024.