Healthcare experts and industry leaders have expressed disappointment over the limited attention given to the healthcare sector in Union Budget 2024–25, stating that several long-pending demands remain unaddressed despite expectations of increased public health spending.

While welcoming specific measures such as the exemption of three cancer drugs from customs duty and the reduction in Basic Customs Duty (BCD) on X-ray tubes and flat panel detectors used in medical X-ray machines, stakeholders noted that these steps alone fall short of broader sectoral needs.

Industry experts highlighted that key demands—such as increasing public healthcare expenditure to 2.5% of GDP, promoting medical value travel in India, addressing inverted duty structures, resolving unused MAT credits, and rationalising GST with uniform rates and full input tax credit eligibility—were not addressed in the budget.

Stakeholders also pointed out that the limited mention of healthcare was surprising, given that substantial provisions had already been introduced in the Interim Budget. While the Interim Budget laid a foundation for strengthening healthcare infrastructure—through initiatives such as integrating schemes, expanding Ayushman Bharat coverage, and promoting the healthcare workforce—the absence of follow-through measures in the full budget raised concerns.

Experts acknowledged initiatives like scaling up routine immunisation and introducing the HPV vaccine but noted the lack of new announcements specifically targeting the private healthcare sector. Measures such as the Fund of Funds, Startup Fund, and Startup Credit Guarantee Scheme—introduced earlier—are expected to provide indirect support, though no fresh incentives were announced.

Industry leaders also stressed the need for customs duty rationalisation on finished medical devices and components. They argued that reducing duties on X-ray machine components would help domestic manufacturers scale up production, improve competitiveness, and support the government’s “Make in India” initiative.

Concerns were raised about high import duties and the practice of inflating maximum retail prices (MRPs) of imported medical devices, which experts said negatively impacts affordability and access to healthcare.

Overall, experts urged the government to build on the Interim Budget’s foundation in future budgets by addressing taxation issues, strengthening domestic manufacturing, and ensuring balanced growth between public health priorities and private sector innovation.

ET Healthworld