Chennai: Toy importer R. Jaishankar finally has room to stretch his legs in his untidy basement office at Arumbakkam in north-west Chennai. But Jaishankar is not happy with the extra wriggle room that has been created because there are fewer toys in his 2,500 sq. ft warehouse. Until a few months ago, the warehouse used to be crammed with Chinese toys.
Supply crunch: An Odyssey India toy shop in Chennai. The books and toys retail chain has seen a mere 5% jump in summer sales over the previous year, much lower than the 15-20% increase it had expected. Ganesh K / Mint
Confusion over new regulations governing import of toys from China and introduced by the Directorate General of Foreign Trade, or DGFT, in March is responsible for this; it has held up containers of several importers such as Jaishankar.
Cargo of the world’s largest toy company Mattel Inc.’s Indian unit too spent longer than usual at the Mumbai port ahead of the peak vacation sales season, according to one Mattel employee who spoke on condition of anonymity.
The company did not respond to an email query sent last week.
“The customs authorities are not clear about the documents required to clear the containers and that leads to a delay in clearing the goods,” said Jaishankar, managing partner at toy trading agency Emerald Sales Corp.
The new DGFT regulation requires Chinese toy imports to conform to any one of three specified quality standards and requires a certificate from the manufacturer to the effect that the product has been tested at an independent laboratory accredited by the International Laboratory Accreditation Cooperation, an international body of labs and inspectors that facilitates trade.
Importers claim that certificates adhering to more stringent European standards—not part of DGFT’s three prescribed quality standards—are turned down. And that on some occasions Indian buyers who produced copies and not originals of the required paperwork were also refused clearance.
“Our job is to frame policy; providing the required certificates is the headache of importers,” said a DGFT official, who did not want to be named.
Careful and cautious
Jaishankar, who recently started sourcing toys from Thailand, plans to order just 25 containers—each containing toys worth Rs15-20 lakh—from China this year. This will be half the 50 containers he imported last year but Jaishankar wants to be careful about sourcing quality toys that meet the new laws. He is also cautious about demand picking up.
The March ruling by DGFT was aimed at improving the quality of Chinese toys available here and making them more safe for children. The ruling came after a January blanket ban on Chinese toys that were imported unfettered into the country for over a decade.