For years, India’s healthcare priorities have focused largely on physical infrastructure and disease management, while mental health remained under-recognised, under-funded, and often pushed to the margins. The Union Budget 2026 marks a notable shift in this approach, signalling a growing acknowledgement that mental well-being is foundational to individual, family, and societal health.

Presented in Parliament by Finance Minister Nirmala Sitharaman, this year’s Budget brings mental health into sharper focus through institutional expansion, emergency care strengthening, workforce development, and supportive policy measures. While challenges remain, the intent to move toward a more inclusive and humane healthcare system is clearly visible.

Mental Health Moves into the National Spotlight

A key highlight of the Budget is the expansion of India’s mental healthcare infrastructure, particularly in regions that lack access to specialised services. Addressing this gap, Sitharaman stated:

“There are no national institutes for mental healthcare in North India. We will therefore set up a NIMHANS 2.0 and also upgrade National Mental Health Institutes in Ranchi and Tezpur as regional apex institutions.”

The proposed NIMHANS 2.0 campus and the upgradation of existing national institutes are expected to decentralise advanced mental healthcare, training, and research. For families, this could mean earlier diagnosis, reduced travel burdens, and improved continuity of care — especially for children, adolescents, and individuals with complex mental health needs.

Emergency & Trauma Care: Supporting Mental Health in Crisis

Mental health needs often surface most urgently during crises — accidents, sudden illness, emotional breakdowns, or traumatic events — moments when families are least prepared, both emotionally and financially. Recognising this, the government announced a 50% expansion in emergency and trauma care capacity in district hospitals across the country through the establishment of dedicated emergency and trauma care centres.

Presenting the Budget in Parliament, Sitharaman said the move was aimed at addressing gaps in mental healthcare access, particularly in emergencies that expose vulnerable families to sudden financial strain, and added that emergency and trauma care capacity in district hospitals would be expanded by 50%.

Strengthening district-level emergency services has the potential to reduce out-of-pocket expenditure during medical and psychological emergencies, while ensuring faster access to care that integrates both physical and mental health support.

Building a Skilled and Inclusive Mental Health Workforce

Infrastructure alone cannot meet India’s mental health needs without trained professionals on the ground. As part of a broader employment and skilling initiative, the Budget announced a large-scale expansion of allied health education.

Existing institutions for allied health professionals (AHPs) will be upgraded, and new AHP institutions will be established across both government and private sectors. The initiative aims to add 1 lakh allied health professionals over the next five years across disciplines such as optometry, radiology, anaesthesia, and other allied fields — many of which intersect closely with mental health, rehabilitation, and long-term care.

Mental health practitioners, psychologists, and psychotherapists have welcomed this focus, noting that India urgently needs a broader, multidisciplinary mental healthcare workforce. Psychologists, counsellors, psychotherapists, behavioural therapists, and community-based professionals play a critical role in prevention, early intervention, emotional regulation, trauma-informed care, and family support.

Breaking the Stigma Around Mental Illness

Psychotherapists have described the Budget’s emphasis on mental healthcare as a hopeful step toward dismantling long-standing stigma. For decades, mental illness in India has been treated as a taboo, forcing families to hide treatment, delay seeking help, and suffer in silence.

By embedding mental health within national healthcare planning — alongside emergency services, education, and workforce development — the Budget represents an important beginning towards normalising mental health care and ensuring that support is accessible, visible, and socially accepted across communities.

Supporting Measures: Innovation and Affordability

Alongside its mental health focus, the Budget also outlined strategic shifts aimed at strengthening healthcare innovation and affordability. To reduce dependency on imports, the government announced initiatives to advance India’s biopharmaceutical and research ecosystem, including expanded clinical trial networks, new research centres, and support for biologics and biosimilars.

Addressing the financial burden of cancer care, Sitharaman stated:

“To provide relief to patients, particularly those suffering from cancer, I propose to exempt basic customs duty on 17 drugs or medicines.”

The exemption applies to critical cancer-related drugs and medicines, and extends to medicines for seven rare diseases imported for personal use. While public health experts note that true affordability requires attention across the full treatment journey — including diagnostics and supportive care — the move offers some relief to families facing high medical costs.

At Insighte, we see the Union Budget 2026 as a meaningful and much-needed step forward. The explicit recognition of mental health within national healthcare planning — through institutional expansion, emergency care strengthening, and workforce development — reflects a growing understanding that emotional and psychological well-being cannot be separated from overall health. While sustained implementation will be key, this shift signals hope for families who have long struggled to access timely, stigma-free mental health support, and reinforces the importance of building systems that respond with empathy, dignity, and care.

A Beginning, Not the Destination

The Union Budget 2026 may not solve India’s mental health challenges overnight, but it does mark a clear shift in intent — from viewing mental health as a peripheral concern to recognising it as a core public health priority. For families, practitioners, and organisations working in this space, the Budget offers cautious optimism. The real impact will depend on how these announcements translate into action on the ground, but for many, this moment represents a long-awaited step toward a more compassionate and inclusive healthcare system.