India carries nearly one-fifth of the global burden of diabetes cases, the majority of which are of type 2 diabetes. Recognising the need for controlling diabetes, the Government of India has initiated a national level programme for prevention and control of diabetes along with other non-communicable diseases in 2008. Despite being piloted and implemented, there is hardly any published literature about the national level situation of diabetes and its control efforts. The present article is written with the aim to fill this gap to some extent and to provide a situational analysis of the diabetes problem in India in a holistic way, addressing policy needs for the national programme. It focuses on three main areas, namely, awareness of diabetes, costs of drugs for its treatment and healthcare-system related issues. It argues that poor coverage and weak implementation of the national level programme are major forces that push patients to seek help in the weakly regulated private sector. Approaching the private sector is likely to increase the cost of care, which in turn can lead to an increased financial burden for patients and their families due to factors such as patients' lack of awareness about diabetes, poor drug price regulation and prescriptions including combinations and/or patented products of medicines used for treating diabetes by the private sector. This article addresses several needs such as strengthening the national programme and increasing its reach to unreached districts, exerting drug price regulation and implementing community-based participatory programmes for prevention and management of type 2 diabetes. It also underscores a need for piloting and implementing a robust national level electronic reporting system for diabetes programmes.