Union Budget 2026-27: Mental Health Without Money Is Detrimental Health

The government has finally applied to mental health the first principle of policy PR: an announcement is enough to generate positive headlines; actual action be damned.

Credit: Rashi Trehan

During her Union Budget speech five years ago, Finance Minister Nirmala Sitharaman had announced a vehicle scrapping policy under ‘health and wellbeing’ but had not mentioned mental health at all. I was so deeply disappointed by this omission that since then, I chose not to review any Union Budget (All references to “I”/“my” in this article refer to the first author).

My disappointment was especially exacerbated particularly by the timing. The Union Budget 2021-22 was presented during the COVID-19 pandemic, after the first wave had already upended lives, livelihoods and collective mental resilience, and barely two months before the devastating second wave arrived.

That five year long disappointment was finally punctuated by the words “applied psychology and behavioural health” in the Budget 2026-27 speech today.

Under the section “Creation of Professionals for Viksit Bharat”, FM Sitharaman stated that “Existing institutions for Allied Health Professionals (AHPs) will be upgraded and new AHP Institutions established in private and Government sectors. This will cover 10 selected disciplines, including optometry, radiology, anesthesia, OT Technology, Applied Psychology and Behavioural Health and add 100,000 AHPs over the next 5 years.”

Later, “reaffirming [her government’s] commitment to mental health”, the Finance Minister declared that “There are no national institutes for mental healthcare in north India. We will therefore set up a NIMHANS-2 and also upgrade National Mental Health Institutes in Ranchi and Tezpur as Regional Apex Institutions.”

Let’s unpack these announcements and the budgetary allocations for mental health beyond the headlines. This article does not attempt an exhaustive analysis; rather, it offers a preliminary commentary to frame the key issues and implications.

Allied Health Professionals

The National Commission for Allied and Healthcare Professions Act, 2021 was passed by the Parliament of India five years ago. Only now has the government announced a dedicated scheme for the development of allied health professionals.

The government has allocated ₹1,000 crore under the Scheme for Allied Health Care Professionals (AHPs). As stated earlier, the scheme will cover 10 disciplines, and over the next five years, add an average of 20,000 AHPs per year. Of these, the average number of mental health, no, behavioural health professionals (BHPs) to be added is 2,000 per year.

This raises a critical question. India already has hundreds of institutions offering courses in psychology and graduating thousands of students. Will this scheme cover them or is it limited to only 2,000 BHPs?

Wait, there won’t be 2,000 psychology professionals, actually.

The category titled “Community Care, Behavioural Health Sciences and Other Professionals” is a broad umbrella that also includes ecologists, environmental protection officers, occupational and safety health officers, social workers, podiatrists, and palliative care professionals. Consequently, the actual number of psychology professionals supported under the scheme may be lower than even 500 per year.

And before we consider this lower number also, what about the tens of thousands of psychology graduates already in the system, trained and qualified, yet struggling to find clear pathways, formal recognition and meaningful employment?

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NIMHANS-2

It is true that North India does not have a dedicated national mental healthcare institute. In that context, the announcement of establishing a NIMHANS-like institution is a welcome step. However, it remains only an announcement. No dedicated budget has been allocated by the government for setting up the new NIMHANS.

Similarly, no budgetary provision has been announced for the upgradation of the “National Mental Health Institutes in Ranchi and Tezpur as Regional Apex Institutions.”

It is possible that allocations for these institutions may have been subsumed under other budget heads. However, a review of allocations under the Ministry of Health and Family Welfare indicates that no funds have been specifically earmarked for these institutions under any head.

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Tele MANAS

The National Tele Mental Health Programme (Tele MANAS) seeks “to provide universal access to equitable, accessible, affordable and quality mental health care through 24x7 tele-mental health counselling services as a digital component of the National Mental Health Programme (NMHP) across all Indian States and UTs with assured linkages.”

In the Union Budget 2025-26, Tele MANAS received ₹79.60 crore. This year, the figure has fallen sharply to ₹51.14 crore, a reduction of 35.75%. More tellingly, of the ₹79.60 crore provided last year, only ₹45 crore has been projected to be actually spent in the Revised Estimates. This has become a recurring feature of mental health schemes: not only do allocations fail to rise, even the amounts set aside are often left unutilised.

National Mental Health Programme (NMHP)

Tele MANAS was launched apparently as a digital component of the NMHP in the aftermath of the COVID-19 pandemic, on World Mental Health Day in 2022. Since then, the government has announced a separate annual budget for Tele MANAS. However, allocations for the NMHP are no longer known, as the programme has been subsumed under the line item Tertiary Care Programme (TCP).

The TCP also includes the Tobacco Control and Drug De-addiction Control Programme, Assistance for Capacity Building for Trauma Centres, the National Programme for Prevention and Control of Cancer, Diabetes, Cardiovascular Diseases and Stroke, Health Care for the Elderly, the National Programme for Blindness, and Telemedicine. All TCP schemes together received ₹483.54 crore in the Union Budget 2025–26, which has increased marginally to ₹490 crore this year. However, the original ₹483.54 crore figure itself has been revised downward to ₹295 crore in FY26.

It is now known to everyone that the NMHP and the District Mental Health Programme have failed to deliver for decades. Yet, no serious corrective steps have been taken to address structural weaknesses or to expand mental health services in villages and small towns. Without transparent budgeting and focused implementation, the treatment gap is only widening.

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Other Allocations

As in previous years, the allocations for NIMHANS and Lokpriya Gopinath Bordoloi Regional Institute of Mental Health, Tezpur have been increased.

But the allocation for The National Trust for the Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation [again, why do we still have this phrase in this law?] and Multiple Disabilities has stayed the same at ₹35 crore. In the Union Budget 2020-21, the proposed outlay for the National Trust was ₹39.50 crore. It is disappointing that even after six years, allocations have not crossed that level.

The outlay for the Scheme for Implementation of the Persons with Disabilities Act has risen marginally from ₹115 crore to ₹125 crore. This, however, represents a sharp decline from the Revised Estimates of ₹200 crore.

Similarly, the allocation for the National Action Plan for Drug Demand Reduction has remained flat at ₹333 crore, again significantly lower than the Revised Estimates of ₹420 crore.

So what has increased substantially?

Bureaucracy.

Salary and pension expenditures under the Department of Health and Family Welfare have risen by around 15%, even as the department’s overall budget has grown by only about 9.5%.

Economic Survey

In the Economic Survey 2025-26, the term ‘mental health’ appears twenty-seven times across Chapters 11 and 14, but most mentions are perfunctory. The subject is largely framed around lifestyle and preventive care, missing both the urgency of the crisis and the deep gaps in public mental healthcare delivery.

The Survey name drops NIMHANS, Tele MANAS and National Mental Health Survey without any insightful linkages with structural drivers, thus watering the canopy and missing the roots. There is limited discussion on key drivers of mental health outcomes in India such as unemployment, educational pressure, socioeconomic inequalities, gender disparities, and stigma. The issue of suicide is mentioned only in terms of its relation with social connectedness as the only determinant. It is mere minimisation of the problem suicide in India missing the realistic picture.

The discussion on the mental health impact of the misuse and abuse of digital technology and AI primarily serves as a foundation for the Promotion and Regulation of Online Gaming Act, 2025, . While the legislation aligns with global regulatory trends, it lacks India-centric data, patterns, and inferences. It concludes with the following:

“A major challenge in addressing digital addiction in India is the lack of comprehensive national data on its prevalence and mental health effects. This hinders targeted intervention, resource allocation, and integration of digital wellness into national mental health strategies. The upcoming Second National Mental Health Survey (NMHS), led by NIMHANS and commissioned by MoHFW, is expected to generate empirical and actionable insights into the prevalence of mental health issues in the Indian context.”

Here’s the core issue: the first NMHS was conducted more than a decade ago. What concrete actions did the government take on that survey’s “empirical and actionable insights”? None. The situation on the ground remains unchanged.

But let us give credit where it is due.

The government has finally applied to mental health the first principle of policy PR: an announcement is enough to generate positive headlines; actual action be damned.