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Business News/ News / India/  Indian toy manufacturers bolster production as demand rises; eye global markets

Indian toy manufacturers bolster production as demand rises; eye global markets

Indian toy manufacturers have scaled up production amid propulsive factors of rising demand and favourable government policies; they are also eyeing global markets

A toy production facility in India (Mint)Premium
A toy production facility in India (Mint)

Favourable government policies have boosted domestic manufacturing and helped the industry to explore global markets and enhance exports. Increasing customs duties on imported toys and mandating Bureau of Indian Standards (BIS) certification requirements for imports have given the necessary push to the Indian toy industry.

Demand for toys based on desi movie characters, mythological characters and superheroes such as Chota Bheem are on the rise.

Indian toys industry is breaking away from the dominance of China and some other countries, according to industry experts.

Manufacturers are scaling up their production capacity to meet the growing local as well as international demand with ‘made-in-India’ taking a clear edge over imports.

Looking into numbers released by the Ministry of Commerce & Industry, import of toys into India have witnessed sharp decline from USD 304 million in 2018-19 to USD 36 million in 2021-22.

On the other hand, exports have increased from USD 109 million in 2018-19 to USD 177 million in 2021-22, it added.

The sector is also scouting for new markets to increase exports to the Middle East and African countries.

Toy Association Of India president, Ajay Agarwal stated, the Indian toy industry is growing as the government has mandated the domestic players to have BIS (Bureau of Indian Standards) certification for import and also increased customs duty.

"These are the two reasons as import of toys has declined," Agarwal said. According to him, the retail sales value was around 20,000 crore pre-pandemic and is expected to grow further this year led by increasing demand.

The toy industry is expected double up from 2019-20 estimates of $1 billion to $2 billion by 2024-25, according to a joint report by industry body FICCI and KPMG, 

Agarwal further added, "Three years back 80 per cent of the toys were imported and the rest 20 per cent was from the domestic manufacturers but now the situation has changed… Imports have been reduced by 60 to 70 per cent and many players are only importing components and assembling the toy in India."

Promotor of Panda International, Rajeev Batra said that the government's move to prohibit the sale of non-certified toys in the country played a "game changer" role in boosting domestic manufacturing and reducing imports from China.

He said that the government's hand-holding is helping the industry to set up manufacturing units.

Manu Gupta, promotor of Playgro Toys India, also said that some more government support would help the industry to reach the next level and generate jobs and boost exports.

"The global toy industry is about USD 120 billion and India's share is low. A national toy policy and production linked incentive scheme would help in promoting the growth of the sector," Gupta said.

The industry has suggested the government to introduce a production linked incentive scheme for the sector and a separate export promotion council for them.

Government's favourable policies

The government has mandated all toy manufacturers and importers to have BIS (Bureau of Indian Standards) quality certification, since January 2021.

Over 800 manufacturers in the toy industry primarily from the Micro, Small and Medium Enterprises (MSME) sector now have BIS certification.

Anil Agarwal, additional secretary in the Department for Promotion of Industry and Internal Trade (DPIIT) said that the government's initiatives like increasing import duty and issuance of quality control order has helped in cutting imports and promoting manufacturing, and now the industry has to "think on big ideas".

To promote local manufacturing., basic Customs Duty (BCD) on toys was increased from 20 per cent to 60 per cent in February 2020.

Two years ago, in the later half of 2020 Prime Minister Narendra Modi had promoted and called upon startups and entrepreneurs to "team up for toys".

He asserted that the country has talent and ability to become a hub for the industry, noting India's minuscule share in the global toy market of over 7 lakh crore.

With inputs from PTI.

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Published: 14 Aug 2022, 05:00 PM IST
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