Written by Supriya Kaushik1, Research Assistant, Center of Policy Research and Governance (CPRG).
Taking an expansive approach, the Economic Survey 2024-25 views mental well-being as an economic issue, defining it as “the ability to navigate life’s challenges and function productively.”2 This signals a growing recognition that an individual’s capacity to contribute meaningfully is directly shaped by their psychological well-being.
The Survey goes beyond a general discussion of mental health, specifically flagging concerns among vulnerable groups including pregnant women, new mothers, employees, children with disabilities, and the youth. It examines how work culture, lifestyle choices, and eating habits dynamically shape mental health outcomes, acknowledging that prolonged stress, unhealthy routines, and inadequate support systems can leave lasting consequences. By advocating for a proactive approach to mental well-being, the Survey positions mental health not merely as a personal concern but as a fundamental economic and policy priority.
On the fiscal front, an upward trend of 11.68% has been observed in the allocation for the health sector between the Revised Estimates of 2024-253 and Budget Estimates of 2025-264, with the most recent allocation standing at ₹98,311 crore, comprising 1.9% of the total budget. While this positive shift underscores the government’s broader recognition of health as a crucial pillar of socio-economic welfare, mental health remains largely invisible within this allocation. The absence of a dedicated budget line exposes a critical gap: without clearly demarcated funds for mental health, the broader health budget risks diluting the targeted interventions needed to address psychological distress – particularly among those most vulnerable.
To fully understand India’s investment in mental health, it is necessary to examine not just headline allocations, but also the disaggregated line items under the Ministry of Health and Family Welfare (MoHFW), alongside indirect allocations channelled through the Ministry of Social Justice and Empowerment (MoSJE).
Need for Bridging the Gap:
Despite affecting over 10.6% of Indian adults, mental health remains one of the most underfunded components of the country’s public health system5. According to the National Mental Health Survey 2015-16, the country has just 0.75 psychiatrists per 1,00,000 people, and over 70% of those in need receive no treatment6. This treatment gap directly contradicts judicial interpretations of Article 21, which uphold every citizen’s right to dignity and access to non-discriminatory healthcare7.
In stark contrast to the scale of the crisis, India’s budgetary allocation for mental health is strikingly low – only about 0.8% of the national health budget. Put differently, less than one rupee out of every 100 rupees spent on health is for mental health. This is significantly lower than other large emerging economies. China and South Africa, for example, spend roughly 2.35% and 5% of their health budget on mental health services respectively. High-income countries typically allocate 5-10% of health budgets to mental health, several times India’s proportion.
While the 2025-26 Union Budget reflects an overall increase in health spending, the lack of a standalone, dedicated allocation for mental health risks diluting targeted interventions under generic health programs. This makes both budget tracking and impact assessment exceedingly difficult, especially when allocations are diffused across multiple departments and schemes.
Direct Allocation under Ministry of Health and Family Welfare (MoHFW)8:
For the financial year 2024-25, the Revised Estimates for the overall health sector stood at ₹88,032 crore, with ₹86,582.48 crore allocated specifically to the Department of Health and Family Welfare (DoHFW). In the 2025-26 Budget Estimates, this allocation increased to ₹98,311 crore, of which ₹95,957.87 crore is earmarked for the same department.
Table 1: Union Budget Allocations for Health Sector and Department of Health and Family Welfare (in ₹ crore)
| Allocations(in crore) | Health Sector | Department of Health and Family Welfare |
| Revised Estimates2024-25 | 88,032 | 86,582.48 |
| Budget Estimates2024-25 | 98,311 | 95,957.87 |
Within this, the budget outlines three specific items related to mental health. Among them, the National Tele Mental Health Programme (Tele MANAS) stands out as a critical initiative aimed at making mental health services more accessible by offering 24/7 therapeutic and psychiatric consultations across the country. However, despite its potential to bridge India’s treatment gap, funding for Tele-MANAS declined by 32.7% between 2023–24 and 2024–25, raising serious concerns about long-term commitment to digital mental health delivery.
In contrast, two centrally-run mental health institutions saw increased allocations. The budget for the National Institute of Mental Health and Neuro-Sciences (NIMHANS), Bengaluru, and the Lokpriya Gopinath Bordoloi Regional Institute of Mental Health, Tezpur, has increased by 10.26% and 30% respectively. However, the third such institution, the Central Institute of Psychiatry, Ranchi, continues to be grouped under the broader category of “Other Hospitals/Institutions,” making its exact allocation difficult to trace. A similar issue arises with the National Mental Health Programme, which has been subsumed under the larger Tertiary Care Programme. This bundling of mental health spending into general categories complicates efforts to track targeted support and undermines budgetary transparency.
Overall, the allocation for mental health under the MoHFW continues to form just 1.05% of the total health budget. The year-on-year increase is merely 0.04% compared to the Revised Estimates for 2024–25, indicating a negligible improvement despite increasing demand and policy acknowledgment.
Table 2: MoHFW Allocations for Key Mental Health Programmes and Institutions (in ₹ crore)
| MoHFW Allocations (in crore) | Revised Estimates2024-25 | Budget Estimates2024-25 |
| NIMHANS, Bengaluru | 780 | 860 |
| Lokpriya Gopinath Bordoloi Regional Institute of Mental Health, Tezpur | 50 | 65 |
| National Tele Mental Health Programme (Tele MANAS) | 45 | 79.6 |
| Tertiary Care Programme (includes funds for National Mental Health Programme) | 322.9 | 483.54 |
Indirect Allocation under Ministry of Social Justice and Empowerment (MoSJE)9:
The Revised Estimates for 2024-25 allocated ₹46,482 crore for social welfare, with ₹10,026.4 crore to the Department of Social Justice and Empowerment and ₹1,167.27 crore to the Department of Empowerment of Persons with Disabilities. In the 2025-26 Budget Estimates, these figures rose to ₹60,052 crore, ₹13,611 crore, and ₹1,275 crore respectively. While this increase signals greater prioritization of the social sector, mental health remains largely invisible as a defined category under these budget heads.
Table 3: Union Budget Allocations for Social Welfare Sector, Department of Social Justice & Empowerment, and Department of Empowerment of PwDs (in ₹ crore)
| Allocations(in crore) | Social Welfare | Department of Social Justice and Empowerment | Department of Empowerment of Persons with Disabilities |
| Revised Estimates2024-25 | 46,482 | 10,026.4 | 1,167.27 |
| Budget Estimates2024-25 | 60,052 | 13,611 | 1,275 |
Yet, the Ministry of Social Justice and Empowerment (MoSJE) plays a critical role in India’s mental health architecture through its indirect but important pathways. For example, substance abuse, recognized as a mental health condition under the Mental Healthcare Act, 2017, is addressed through the National Action Plan for Drug Demand Reduction (NAPDDR) – a centrally sponsored scheme aimed at reducing drug consumption. In the 2025–26 Budget, the allocation for this scheme saw a significant 38.75% increase, suggesting greater acknowledgement of the mental health-substance abuse linkage.
Similarly, the Rights of Persons with Disabilities Act (2016) includes mental illness among the 21 recognised disabilities. In this context, the Assistance to Disabled Persons for Purchase/Fitting of Aids scheme was allocated ₹316 crore, down from ₹350 crore in the previous year. Funding for the Deendayal Disabled Rehabilitation Scheme and the Scheme for Implementation of the Persons with Disabilities Act has seen a marginal rise.
Table 4: MoSJE Scheme-Wise Allocations Relevant to Mental Health and Disability (in ₹ crore)
| MoSJE Allocations (in crore) | Revised Estimates2024-25 | Budget Estimates2024-25 |
| National Action Plan for Drug Demand Reduction (NAPDDR) | 240 | 333 |
| Assistance to Disabled Persons for Purchase/Fitting of Aids | 350 | 316 |
| Deendayal Disabled Rehabilitation Scheme | 139 | 165 |
| Scheme for implementation of Persons with Disability Act | 111 | 115 |
Together, these allocations reflect a fragmented yet evolving landscape, where mental health appears across schemes but lacks cohesive framing or accountability. Strengthening the role of MoSJE through clearer mandates, defined budget lines, and inter-ministerial coordination could significantly improve support for vulnerable populations living with mental illness.
The Way Forward:
A thorough analysis of India’s health budget, especially when viewed against the scale of the mental health crisis, underscores the urgent need for increased and more targeted investment. Allocations for mental health must not only rise in absolute terms but also in proportion to the overall health budget. The current allocation is vastly inadequate, even though mental illness accounts for a substantial share of India’s disease burden. A progressive increase toward 3-5% of the total health budget over the next five years should be envisioned, guided by a long-term public health strategy.
As a critical first step, India must conduct a nationwide, comprehensive evaluation of mental health morbidity and infrastructure. This would enable evidence-based, region-specific budgeting. Just as importantly, there is a need to clearly demarcate the mental health budget within national and state allocations to ensure accountability, transparency, and ease of policy tracking.
Notably, from situation analysis to implementation, ensuring participation by all relevant stakeholders is essential (Lesage, 1999)10, including local communities, individuals with lived experience, caregivers, service providers, and policymakers. Mental health planning cannot be approached as a purely technical exercise; it demands deliberate consensus-building across diverse viewpoints, rooted in empathy and long-term vision11.
However, increasing allocations is only one part of the solution. There is also a pressing need to decentralize funding and empower state governments to implement context-specific mental health responses. India’s vast socio-cultural and economic diversity demands that mental health programs be tailored to local realities. The Centre must therefore consider enhancing the flexibility of existing centrally sponsored schemes (CSS) like the National Mental Health Programme by introducing performance-based incentives for states that demonstrate innovation in community-based mental health delivery. Rather than launching entirely new funding instruments, reforming existing schemes to allow states greater discretion can foster cooperative federalism without adding administrative complexity. Crucially, this must be accompanied by stronger monitoring and inter-state knowledge-sharing platforms to ensure learnings from effective state models are scaled across the country.
Finally, mental health should not be treated as a siloed health concern. It must be mainstreamed into the existing policy frameworks of employment, education, and workplace safety. In essence, allocating greater funding for mental health is not merely a moral obligation – it is an economic necessity, a public health imperative, and a strategic step towards securing India’s long-term well-being.
- Supriya is a Research Assistant at the Center of Policy Research and Governance (CPRG), Delhi, where she oversees the Future of Society vertical, focusing on the societal impact of AI and emerging technologies. She holds a Master’s in Organizational Psychology from Daulat Ram College and a Bachelor’s in Psychology from Lady Shri Ram College, University of Delhi. ↩︎
- Government of India. (2025). Economic Survey 2024–25. Ministry of Finance, Department of Economic Affairs. https://www.indiabudget.gov.in/economicsurvey/
↩︎ - Government of India. (2024). Union Budget 2024–25: Annual Financial Statement. Ministry of Finance, Department of Economic Affairs. ↩︎
- Government of India. (2025). Union Budget 2025–26: Annual Financial Statement. Ministry of Finance, Department of Economic Affairs.
↩︎ - Press Information Bureau. (2025, February 7). Advancing mental healthcare in India. Ministry of Health and Family Welfare, Government of India. https://pib.gov.in/PressReleasePage.aspx?PRID=2100706 ↩︎
- National Institute of Mental Health and Neurosciences. (2016). National Mental Health Survey of India, 2015–16: Mental health systems. Ministry of Health and Family Welfare, Government of India. https://mohfw.gov.in/sites/default/files/National%20Mental%20Health%20Survey%2C%202015-16%20-%20Mental%20Health%20Systems_0.pdf ↩︎
- Khurana, V. (2023). Critical analysis of the various facets of right to health under Article 21 of the Constitution. Indian Journal of Integrated Research in Law. https://ijirl.com/wp-content/uploads/2023/06/CRITICAL-ANALYSIS-OF-THE-VARIOUS-FACETS-OF-RIGHT-TO-HEALTH-UNDER-ARTICLE-21-OF-THE-CONSTITUTION.pdf ↩︎
- Government of India. (2025). Demands for Grants 2025–26: Demand No. 46 – Ministry of Health and Family Welfare. Ministry of Finance, Department of Economic Affairs. https://www.indiabudget.gov.in/doc/eb/sbe46.pdf ↩︎
- Government of India. (2025). Demands for Grants 2025–26: Demand No. 93 – Ministry of Social Justice and Empowerment. Ministry of Finance, Department of Economic Affairs. https://www.indiabudget.gov.in/doc/eb/sbe93.pdf ↩︎
- Lesage, A. D. (1999). Canada. In G. Thornicroft & M. Tansella (Eds.), The mental health matrix: A manual to improve services (pp. 201–205). Cambridge University Press. ↩︎
- World Health Organization. (2003). Planning and budgeting to deliver services for mental health (Mental Health Policy and Service Guidance Package). World Health Organization. https://apps.who.int/iris/handle/10665/333115 ↩︎