In a significant move to make life-saving healthcare more affordable, Finance Minister Nirmala Sitharaman announced a complete exemption of Basic Customs Duty (BCD) on 17 essential cancer drugs during the Union Budget 2026 on February 1, 2026.
This decision is part of a broader healthcare package aimed at reducing the financial burden on patients battling chronic and rare diseases.
1. Key Healthcare Exemptions
The 2026 Budget focuses heavily on “Ease of Living” through targeted tax relief for the medical sector:
- 17 Cancer Drugs: Fully exempted from basic customs duty to lower the cost of advanced chemotherapy and immunotherapy treatments.
- 7 Rare Diseases: The government added seven more rare diseases to the list for customs duty exemptions on the personal import of specialized medicines and medical foods (FSMP).
- Medical Remittances: The Tax Collected at Source (TCS) on funds sent abroad for medical purposes has been slashed from 5% to 2% (without any threshold), providing immediate liquidity relief for patients seeking treatment overseas.
2. Strategic Impact: Why It Matters
- Affordability: Many advanced cancer drugs are currently imported from the US and Europe. A 0% duty can reduce the retail price of these life-saving medications by 10% to 20%, depending on the previous tariff structure.
- Non-Communicable Disease (NCD) Burden: The FM noted that India’s disease burden is shifting toward NCDs like cancer and auto-immune disorders. These exemptions are designed to make “biological medicines,” which are key to longevity, accessible to the middle class.
- Simplification: By removing the duty, the government is streamlining the import process for hospitals and pharmacies, ensuring that essential drugs reach patients faster without being held up by tariff disputes.
3. Beyond Duty Cuts: Infrastructure & Skills
To complement the tax relief, the budget also proposed a massive expansion of India’s medical capacity:
- NIMHANS-2: A second National Institute of Mental Health and Neurosciences (NIMHANS) will be established in North India to address the acute shortage of specialized psychiatric facilities in the region.
- District Hospital Upgrades: A plan to increase the capacity of district hospitals by 50% through new emergency and trauma care centers.
- Allied Health Professionals: A new initiative to train one lakh Allied Health Professionals over the next five years to support the growing network of hospitals.
Conclusion: A Patient-Centric Budget
While the STT hike on the same day drew the attention of the financial markets, the exemption for 17 cancer drugs represents the “human face” of Budget 2026. By tackling the high cost of imported medicine and simplifying foreign remittance for health, the government is providing tangible relief to millions of Indian families.
