Story of India's Toy Industry: On the Verge of Massive Expansion
🔍Insights
The toy industry is one of the most promising export markets because of its high growth potential. Forecasts indicate that the Indian toy market will reach $3 billion by 2028, expanding at a CAGR of 12% from 2022 to 2028, as per the data shared by Invest India. This places it among the world's fastest-growing industries.
The toy sector in India is growing its international footprint by sending more expensive toys to countries in Africa and the Middle East. A rise from 60% to 70% was enacted in Budget 2023 regarding the import tariff on toys. In 2021, the Toys Quality Control Order (QCO) was put into effect to guarantee the safety of imported and manufactured toys by increasing their standardization.
Success Story of Made in India Toys
Revolutionary Sparks
Success Story of Made in India Toys
With a 52% drop in imports, a 239% increase in exports, and an improvement in the overall quality of the toys offered in the domestic market, the Indian toy sector saw tremendous growth in FY 2022-23 compared to FY 2014-15. The Indian Institute of Management (IIM) Lucknow, in collaboration with the Department for Promotion of Industry and Internal Trade (DPIIT), has undertaken a case study on the "Success Story of Made in India Toys" that takes these points into account.
The government's initiatives have improved the production environment for the Indian toy business, according to the research. The report emphasized that between 2014 and 2020, a total of six years of hard work, doubled the number of manufacturing units, cut reliance on imported inputs from 33 percent to 12 percent, increased gross sales value by 10 percent CAGR, and improved worker productivity.
The survey found that zero-duty market access for locally manufactured toys in countries like Australia and the United Arab Emirates, as well as India's integration into the global toy value chain, are contributing factors to the country's rise to the position of the top exporter. According to the report, if India wants to make a name for itself in the toy industry and compete with China and Vietnam, it needs the government and the toy industry to work together on several fronts, including technological advancements, eCommerce, partnerships, exports, brand-building, communicating with parents and teachers, cultural diversity, collaboration with local artisans, etc.
The goal of Prime Minister Narendra Modi's "Mann ki Baat" speech in August 2020 was to make India a major player in the toy industry. Government efforts to realise the vision include, among other things, the creation of comprehensive plans like the National Action Plan for Toys (NAPT) to encourage plaything design, plaything use as a teaching tool, plaything quality control, indigenous plaything clusters, etc.
Revolutionary Sparks
This turnaround was greatly influenced by the 'Make in India' project, which was spearheaded by the Indian government and aimed at strengthening domestic manufacturing skills. The toy industry reaped considerable benefits from this movement's goal of revitalizing the nation's industrial sector. As a safeguard against the flood of imported toys, local makers were given a boost by the implementation of higher customs taxes, which were increased from 20% to 60% in 2020 and then to 70% in 2023.
The noose around low-quality imports was further tightened by non-tariff measures, such as strict quality control standards and required testing for import shipments. The government's dedication to improving the quality and safety standards of toys, both imported and domestically produced, was highlighted in 2021 with the adoption of the Quality Control Order (QCO) for toys.
In addition to regulatory measures, the government also took aggressive steps to encourage innovation and self-sufficiency in the industry. Promoting indigenous toys, encouraging startups, and showcasing Indian craftsmanship on global platforms have been made possible through programs like the National Action Plan for Toys (NAPT), the Toy Cluster under the Scheme of Funds for Regeneration of Traditional Industries (SFURTI), and the Indian Toy Fair 2021.
As a result of India's participation in the global toy value chain and the elimination of tariffs on toys made in India in countries like the United Arab Emirates and Australia, the toy industry in India has also flourished. The international toy expo in Germany recently saw orders worth crores of rupees for Indian toys from countries like the United States, the United Kingdom, South Africa, and Germany, among others.
The incredible journey of endurance and strategic brilliance is exemplified by the evolution of the Indian toy sector into a global innovation hub. The sector has triumphed over import obstacles by embracing cultural diversity, innovation, and quality, with the help of the government and the dynamism of small and medium-sized enterprises (SMEs). Technology, sustainability, and worldwide competitiveness will play a pivotal role as it moves forward. This comeback is more than just a financial success; it is a tribute to India's diverse cultural heritage and an indication of the country's growing prominence in the international toy industry. It heralds a future in which play represents inclusivity, learning, and responsibility.
Kinnary Nensee
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