Union Budget 2026 Announces NIMHANS-2 and Major Push for Mental and Trauma Care

Budget 2026 Signals Strong Policy Shift Towards Mental and Emergency Healthcare

The Union Budget 2026–27 has placed mental health and emergency medical services firmly on the national health agenda. Presenting the Budget in Parliament, Nirmala Sitharaman announced the establishment of India’s second national mental health institute and a significant expansion of trauma care infrastructure, aiming to address long-standing gaps in psychiatric services and emergency response systems.

Proposal for India’s Second National Mental Health Institute

A key announcement is the creation of NIMHANS-2 , envisioned as the country’s second National Institute of Mental Health and Neuro Sciences. Currently, National Institute of Mental Health and Neuro Sciences in Bengaluru functions as India’s apex centre for mental health care, training and neuroscience research. Sitharaman noted that the absence of a national-level mental health institute in north India places a heavy burden on patients and caregivers, who often have to travel across states for specialised treatment and referral-based care. NIMHANS-2 is expected to address this regional imbalance.

Strengthening Regional Mental Health Institutions

In addition to the new institute, the Budget proposes upgrading existing national mental health institutions in Ranchi and Tezpur . These facilities will be developed as regional apex centres, enhancing access to psychiatric services, advanced research, and mental health workforce training. The move is aimed at decentralising expertise and reducing pressure on a single national institution.

Major Expansion of Emergency and Trauma Care

Recognising the close link between physical trauma, psychological distress and economic vulnerability, the Budget announced a 50 per cent expansion in emergency and trauma care capacity at district hospitals. New Emergency and Trauma Care Centres will be set up to provide timely medical intervention in cases of accidents, disasters and violence. Sitharaman highlighted that such incidents often push vulnerable families into sudden financial crisis, intensifying long-term mental stress and insecurity.

Important Facts for Exams

• Union Budget 2026 proposes NIMHANS-2, India’s second national mental health institute

• No national mental health institute currently exists in north India

• Trauma and emergency care capacity at district hospitals to be expanded by 50%

• Mental health institutes in Ranchi and Tezpur to be upgraded as regional apex centres

Mental Health as Part of Broader Social Resilience

Mental healthcare was presented as part of a wider strategy to address vulnerability arising from health shocks, disability, economic stress and social change. The Budget’s proposals align with concerns raised in the Economic Survey 2025–26, which identified rising anxiety, depression and stress—particularly among young people—as a growing public health challenge linked to digital addiction, cyberbullying and lifestyle pressures. By combining mental health reform with stronger trauma care, the government aims to build a more resilient and responsive public health system.