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Industry urges govt to reduce API dependency & increase healthcare spending to 3% of GDP in Budget 2025
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Shardul Nautiyal, Mumbai
January 31 , 2025
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As India approaches the Union Budget 2025-26, industry leaders across healthcare and pharmaceuticals are calling for bold reforms to strengthen the nation’s healthcare infrastructure and reduce dependence on imported active pharmaceutical ingredients (APIs). With healthcare spending currently at around 1.5% of GDP, experts urge the government to raise it to 2.5-3% of GDP to ensure equitable access to quality care in both urban and rural areas.
Priyanka Chigurupati, executive director, Granules India, highlights the urgent need to reduce India’s API dependency, with 60-65% of the country's requirements still being met through imports. She urges an expansion of the production linked incentive (PLI) scheme beyond its current Rs.15,000 crore to enhance domestic manufacturing capabilities and ensure a more resilient pharmaceutical ecosystem.
Dr Mandeep Singh Basu, director, Dr Basu Group, echoes this concern and calls for a stronger push under the "Make in India" initiative in healthcare to promote local production. He also advocates for raising the Ayush Ministry’s budget to Rs. 4,500 crore to 4,700 crore, recognizing the increasing global demand for traditional healthcare solutions.
The need for significant investment in healthcare infrastructure remains a key concern. Sushil Suri, chairman and MD, Morepen Laboratories, emphasizes that India's pharma sector is projected to reach $130 billion by 2030 and $440 billion by 2047, yet growth is hampered by regulatory bottlenecks. He calls for streamlined approval processes and an expanded PLI scheme to include medical technology, attracting investments and boosting innovation.
With the rapid adoption of AI-driven healthcare, Chaitanya Raju, executive director & CPO, HealthPlix, anticipates a robust focus on digital health infrastructure in Budget 2025. He stresses the need for strategic investments in generative AI, public-private partnerships, and telemedicine to improve accessibility and ease the burden on healthcare professionals.
Dr Anand, founding director & CEO, Remidio, underscores the urgent need for AI-enabled diagnostics and early disease detection. With 275 million Indians affected by vision impairment, integrating AI into public healthcare initiatives can help prevent fatalities from heart attacks, strokes, and diabetes-related complications.
Dr Lahari Surapaneni, CEO, Bangalore Hospitals, highlights the importance of preventive healthcare and public awareness campaigns, given the alarming rise in lifestyle diseases and heart ailments. She advocates for GST exemptions and reduced customs duties on medical devices to make healthcare more affordable.
Meanwhile, Saumyajit Roy, CEO & co-founder, Emoha, stresses the need for greater investment in geriatric care and mental health support, as India’s elderly population is set to comprise 20% of the total population by 2050. He calls for expanded healthcare access, teleconsultation services, and policies that promote social inclusion for seniors.
Recognizing India's declining fertility rates, Dr Kshitiz Murdia, CEO & co-founder, Indira IVF, urges the government to integrate fertility treatments into universal health insurance and offer tax exemptions on fertility treatments. He stresses that investing in ART infrastructure in Tier 2 and Tier 3 cities will ensure equitable access to reproductive healthcare.
Dr Raj Nagarkar, MD & chief of surgical oncology, HCG Manavata Cancer Centre, calls for higher budget allocations for cancer research, tax incentives for hospitals, and subsidized training programs for surgeons. He emphasizes the need for public-private partnerships in medical innovation to ensure advanced treatments reach more patients.
With India's pharmaceutical market projected to reach $120-130 billion by 2030, Budget 2025-26 presents a pivotal opportunity to reduce API dependency, boost domestic manufacturing, invest in AI-driven healthcare, and increase healthcare spending to 3% of GDP.
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