Status of Indian Toy Industry-Success Story of Made in India Toys

What is the Status of Indian Toy Industry as per the Study?

• Significant Growth Trends:
  • The Indian toy industry exhibited remarkable growth between FY 2014-15 and FY 2022-23, marked by a substantial decline in imports by 52% and a significant rise in exports by 239%.
  • This growth indicates a shift towards self-sufficiency and global competitiveness.
• Quality Improvement:
  • There’s been an overall enhancement in the quality of toys available in the domestic market. This emphasizes the importance of meeting international standards and ensuring consumer satisfaction and safety.
• Growth Drivers:
  • Enhanced Manufacturing Ecosystem: Government efforts have facilitated the creation of a more conducive manufacturing ecosystem. Doubling the number of manufacturing units in six years, reducing dependence on imported inputs from 33% to 12%, increasing in gross sales value by a CAGR of 10% and improving labor productivity are noteworthy achievements.
  • Global Integration and Export Focus: India’s emergence as a top exporting nation in the toy industry indicates successful integration into the global toy value chain. Zero-duty market access in key countries like the UAE and Australia has contributed to this growth trajectory.

What are the Government Initiatives to Foster the Growth in the Toy Industry?

• National Action Plan for Toys (NAPT):
  • A comprehensive strategy with 21 specific action points, coordinated by DPIIT and carried out by several Central Ministries/Departments. This plan addresses a variety of issues, including design, quality control, and the promotion of indigenous toy clusters.
• Increase in Basic Customs Duty (BCD):
  • A substantial increase in BCD on toys (from 20% to 60% in February 2020, and subsequently to 70% in March 2023) aims to protect the domestic toy industry from cheaper imports and encourage local manufacturing.
• Mandated Sample Testing:
  • The DGFT, under the Ministry of Commerce and Industry, requires sample testing for all import consignments to avoid the import of substandard toys and improve quality control.
• Quality Control Order (QCO) for Toys:
  • This order, issued in 2020, aims to improve the quality of toys manufactured and marketed in the country. It will be applicable starting January 2021.
• Provisions for Toy Manufacturers:
  • BIS (Bureau of Indian Standards) has developed special measures, such as providing licenses to small units without testing facilities for a set length of time to help them comply with quality standards.
• BIS Standard Marks:
  • Over 1200 licenses have been awarded to domestic producers and over 30 to international firms, ensuring compliance with quality requirements through BIS markings.
• Cluster-based Approach:
  • The Ministry of MSME supports the domestic toy sector through initiatives such as SFURTI (Scheme of Funds for the Regeneration of Traditional Industries), while the Ministry of Textiles provides design and tooling support to various toy clusters.
• Promotional Initiatives:
  • The Indian Toy Fair 2021 and Toycathon promote indigenous toys, foster innovation, and provide a forum for displaying and ideation within the toy sector.

Way Forward

• To compete with major toy production hubs like China and Vietnam, India’s toy sector and government must work together consistently.
• Key themes addressed include embracing technology, focusing on e-commerce, fostering partnerships and exports, investing in brand-building, and working with educators and parents to improve communication with children.