Indian Toy Industry
16th Sep, 2022
Indian Toy Industry is experiencing a positive trend due to the Make-in-India initiative. The import of toys has declined by 70% in the last three years. On the contrary, the exports are touching new highs and have gained by 61% in the same period.
State of Indian Toy Industry:
- The Indian toy industry is estimated to be valued at approximately 5 billion USD, whereas the global toy industry is about USD 120 billion, making up around 1 per cent of the global market share.
- The toy manufacturers in India are mostly located in NCR, Maharashtra, Karnataka, Tamil Nadu, and clusters across central Indian states.
- The sector is fragmented, where 90 per cent of the market is lacking organization, and adding to them are 4,000 toy industry units from the MSMEs.
- The domestic toy demand is forecasted to grow at 10-15% against the global average of 5%.
Why is Indian Toy Industry attractive for investments?
- World’s second-largest producer of polyester and related fibers with 8% global share for plush toys.
- Domestic toy demand is forecasted to grow at 10-15% against the global average of 5%
- The toys industry in India has the potential to grow to $2-3 bn by 2024.
- According to Census 2011, there are over 158 million children are in the age group of 0-6 in India, which reflects the huge market for the toy industry.
Why has the import of toys been witnessing a decline?
The following are the primary reason for the decline of toys.
- Increasing customs duties on imported toys.
- Mandating Bureau of Indian Standards (BIS) certification requirement for imports.
- Initiatives like ‘team up for toys’, ‘Toycathon’, and ‘Vocal for local Toys’ has created awareness among immediate consumers about made-in-India toys.
Trends in the Indian Toy Market:
- ‘Made-in-India' toys have a very clear edge in the domestic market.
- Demand for toys based on Indian mythological characters is on the rise.
- Import of toys into India has declined sharply from USD 304 million in 2018-19 to USD 36 million in 2021-22.
- Exports have increased from USD 109 million in 2018-19 to USD 177 million in 2021-22.
- The toy sector is also going global, as manufacturers are scouting new markets and increasing exports to the Middle East and African countries.
- Indian manufacturers are now scaling up their production and investing to augment their capacity.
Government measures to increase domestic production and reduce imports of toys:
- Directorate General of Foreign Trade (DGFT) has mandated sample testing of each consignment.
- Basic Customs Duty (BCD) on Toys has been increased.
- Subjects like Maths, Science, and History were integrated into toy product development and production
- Toys have been brought under compulsory Bureau of Indian Standards (BIS) certification.
- Ministry of Education organized Toycathon 21, a unique effort by 6 Ministries & Departments to crowd-sourced solutions to problems faced by the toy industry.
- Under the Scheme of Fund for Regeneration of Traditional Industries (SFURTI) of the Ministry of Micro, Small & Medium Enterprises (MSME), 19 toy clusters have been approved.