Union Budget 2026
New Delhi: Basic customs duty will be exempted on 17 drugs for patients suffering from cancer and non-communicable diseases, while medicines for seven rare diseases will be recognised for import duty exemptions, Union Finance Minister Nirmala Sitharaman announced in the Budget 2026 session on Sunday, February 1.
In the 1-hour 25-minute speech, Sitharaman proposed making drugs cheaper to provide relief to patients who spend crores on medicines while battling these diseases.
The Finance Minister proposed to set up three new All India Institutes of Ayurveda to further strengthen research in traditional medicines and meet the growing demand. The minister said that since Ayurveda gained global acceptance and recognition after the COVID-19 pandemic, it will upgrade AYUSH pharmacies and drug testing labs to higher standards.
Quality Ayurveda products helps farmers who grow the herbs and youth who process the products, she said.
“Ancient Indian yoga, already respected in several parts of the world, was given a mass global recognition when the prime minister took it to the UN (United Nations),” the minister said.
The Finance Minister further proposed launching a scheme to support states in establishing five regional medical hubs while partnering with the private sector.
These hubs will serve as integrated healthcare complexes that combine medical, educational and research facilities, Sitharaman said, presenting the budget 2026-27.
They will have AYUSH centres, medical value tourism facilitation centres and infrastructure for diagnostics, post care and rehabilitation, she stated.
These hubs will provide diverse job opportunities for health professionals, including doctors and allied health professionals, she added.
She also called for upgrading the World Health Organisation (WHO) Global Traditional Medicine Centre in Jamnagar, Gujarat, to bolster evidence-based research, training and awareness for traditional medicine.
Existing training institutions for Allied Health Professionals (AHPs) will be upgraded, and new institutes will be set up in both the government and private sectors, Sitharaman said.
This will cover 10 selected disciplines, including optometry, radiology, anaesthesia, Operating Theatre (OT) Technology, Applied Psychology and Behavioural Health and add 100,000 AHPs.
The plan aims to add about 1 lakh allied health professionals and train 1.5 lakh caregivers over the next five years.
Among the other reforms introduced during the Budget 2026, Sitharaman said the government will be actively working on launching a second site for the National Institute of Mental Health and Neuro Sciences (NIMHANS-2) in North India.
Sitharaman said this was decided due to the lack of mental health institutions in the northern region.
NIMHANS is a multidisciplinary medical institution located in Bengaluru and serves as the main centre for mental health education and research in neuroscience in the country. It is funded by the Ministry of Health and Family Welfare
The Economic Survey 2026 had warned that mental health has become a major issue, especially among the young. It linked mental health deterioration with high screen addiction among the age group of 15-24 and said higher screen time has a lasting effect on academic performance, sleep, productivity and social connections.
To develop India as a global Biopharma manufacturing hub, the budget outlined specific proposals for the expansion and modernisation of clinical trials under the Biopharma SHAKTI (Strategy for Healthcare Advancement through Knowledge, Technology and Innovation) initiative.
The government, in this regard, has created a network of over 1,000 accredited India Clinical Trials sites, which will facilitate the domestic production of biologics and biosimilars, helping to address India’s shifting disease burden toward non-communicable diseases like cancer, diabetes, and autoimmune disorders.
These sites are intended to provide the necessary infrastructure to transform biopharmaceutical “aspiration into achievement” by conducting the essential testing required for new medical innovations.
The Union Budget 2026-27 has allocated Rs 1,05,530.42 crore to the Ministry of Health and Family Welfare, marking an overall increase of 176 per cent since 2014-15.
This post was last modified on February 1, 2026 2:09 pm