India's Pharma Future: Innovation or Volume?

The Indian pharmaceutical industry is targeting substantial growth, with projections of becoming a $120-130 billion sector by 2030 and scaling to $450 billion by 2047. Industry bodies emphasize that the upcoming Union Budget 2026-27, scheduled for February 1, 2026, is critical for steering the sector towards innovation-led expansion rather than mere volume. Global R&D incentives and fiscal support for clinical research are high on the agenda.

The sector's wishlist extends beyond R&D, calling for GST rationalisation on key raw materials to address inverted duty structures and the restoration of weighted R&D deductions. Industry leaders also highlight the need for simplified regulatory frameworks to encourage innovation-led investments. On the healthcare delivery front, the budget is expected to prioritize preventive care, capacity building, and addressing workforce shortages, particularly in non-urban areas.

Previous budgets have shown support, with Union Budget 2025-26 allocating Rs 1,03,280 crore for healthcare. Initiatives like cancer care centers and medical education expansion were initiated. However, execution has seen mixed results, with challenges in fund utilization and persistent workforce shortages. As Budget 2026-27 approaches, stakeholders anticipate clear signals for R&D-driven growth, enhanced clinical research support, and improved public healthcare spending.