Multinationals Urge India to Slash Customs Duties on Critical Care MedTech in Budget 2026

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As India prepares for its Union Budget 2026 presentation amid growing healthcare demands, leading multinational medical technology firms are pressing the government to reduce high customs levies on essential critical care devices, arguing it would enhance affordability and access.

This call comes at a pivotal time when India’s medtech sector faces import dependency for advanced equipment used in ICUs and emergency care.

Key Industry Demands

Multinational companies, including major players in the medical devices space, have highlighted steep customs duties—often exceeding 15-20% on life-saving equipment like ventilators, defibrillators, and advanced monitoring systems—as a barrier to timely procurement by Indian hospitals. These levies inflate costs by 30-50% in some cases, making critical care unaffordable in a country where public health spending remains below 2.5% of GDP. Industry leaders propose aligning duties with the national PLI scheme for medtech, which incentivizes local manufacturing but still relies on imports for high-end tech not yet produced domestically.

The Economic Times Health report underscores that groups like AdvaMed and representatives from firms such as Medtronic and GE Healthcare have submitted formal pleas to the Finance Ministry, emphasizing how duty reductions could save hospitals up to ₹5,000 crore annually while boosting post-pandemic recovery in critical care infrastructure. This push aligns with India’s goal to reach $50 billion in medtech production by 2030, but experts note that without import relief, hospitals in tier-2 and tier-3 cities will continue facing shortages.

Background on India’s MedTech Landscape

India’s medical devices market, valued at approximately $15 billion in 2025, imports over 80% of its needs, particularly for critical care where domestic production lags due to technology gaps and regulatory hurdles. Customs duties, structured under HS codes for medtech, have historically protected nascent local industry but now hinder expansion as demand surges from an aging population and rising chronic diseases like cardiovascular conditions affecting 27% of adults. The government’s 2023-24 budget introduced some exemptions, yet critical care items remain heavily taxed, prompting this renewed advocacy.

Historically, similar pleas during Budget 2024 led to partial relief on stents and orthopedic implants, reducing duties from 7.5% to nil, which dropped prices by 20% and increased access. However, ventilators and ECMO machines—vital during COVID-19 waves—still carry 10-15% duties plus GST, compounding costs amid global supply chain pressures.

Expert Perspectives

Dr. Naresh Trehan, Chairman of Medanta Heart Institute and a vocal advocate for medtech reforms, states, “Reducing customs duties on critical care devices is not just an economic measure; it’s a life-saving imperative. High costs delay adoption of technologies that could reduce ICU mortality by 15-20%.” Trehan, not directly involved in the industry submissions, emphasizes evidence from global studies showing cost barriers exacerbate India’s 1:1,000 ICU bed ratio compared to 1:10 in developed nations.

Conversely, representatives from the Association of Indian Medical Device Industry (AiMeD) caution against blanket reductions, arguing, “While affordability matters, easing duties without PLI-linked safeguards could undermine our $10 billion local manufacturing push.” AiMeD’s Rajiv Nath points to successes like indigenous pacemakers, urging phased reductions tied to technology transfer mandates. This balanced view reflects tensions between import reliance and Atmanirbhar Bharat goals.

International expert Dr. Atul Gawande, formerly of WHO, notes in broader policy commentary that duty rationalization in countries like Brazil improved critical care outcomes by 12% through better-equipped public hospitals, offering a model for India.

Public Health Implications

Lowering these levies could transform critical care accessibility, potentially averting thousands of preventable deaths annually in India’s 1.4 billion population where trauma and cardiac arrests claim over 2 million lives yearly. For healthcare professionals, affordable devices mean faster interventions; for consumers, it translates to lower out-of-pocket expenses, which currently consume 60% of health spending. In rural areas, where 70% of Indians reside, subsidized imports could bridge urban-rural disparities, supporting Ayushman Bharat’s aim to cover 500 million vulnerable citizens.

Economically, duty cuts might spur private investments, creating 500,000 jobs in medtech by 2030 per NITI Aayog projections, while fostering public-private partnerships for local R&D. During monsoons and disaster seasons, cheaper ventilators could bolster emergency responses, as seen in Kerala floods where equipment shortages worsened outcomes.

Limitations and Counterarguments

Critics, including some domestic manufacturers, warn that duty reductions favor multinationals, potentially stifling innovation; AiMeD data shows local firms captured only 20% market share post-2020 exemptions due to scale disadvantages. Regulatory challenges persist—CDSCO approvals for imports take 6-9 months—meaning duty relief alone won’t solve delays. Moreover, global pricing volatility, as in the Ukraine crisis, could offset savings.

Study limitations in industry reports include self-reported cost data without independent audits, and projections assume stable rupee valuation. Government sources like the Finance Ministry indicate Budget 2026 priorities lean toward revenue generation amid fiscal deficits at 5.1% of GDP, tempering expectations for major cuts.

Practical Takeaways for Readers

Healthcare professionals should monitor Budget announcements on February 1, 2026, for duty slabs under Chapter 90 of Customs Tariff, potentially impacting procurement budgets. Health-conscious consumers can advocate via platforms like MyGov for equitable pricing, while hospitals explore bulk import tenders under GE.M portal for interim relief. Long-term, supporting PLI-compliant local firms ensures sustainable access without over-reliance on imports.

This development underscores the interplay of policy and health equity, urging stakeholders to prioritize evidence over protectionism.

Medical Disclaimer: This article is for informational purposes only and should not be considered medical advice. Always consult with qualified healthcare professionals before making any health-related decisions or changes to your treatment plan. The information presented here is based on current research and expert opinions, which may evolve as new evidence emerges.