Another step towards Aatmanirbhar Bharat, India’s toy industry is making significant strides on a global level in terms of toy manufacturing. Growth and development in the toy industry is not only playing a key role in reducing dependency on imports, but is also expanding our export capacity and contributing significantly towards India’s vision to become a global manufacturing hub.
In year 2020, the Hon’ble PM Narendra Modi’s clarion call on uplifting the Indian toy industry led to the introduction new Government initiatives and policies which have helped substantially in boosting exports. The Make in India initiative has yielded positive results for the toy sector in the country, with imports witnessing a slump of 70% and exports rising by 61% over the last three years.
India has a rather significant market presence in this industry, which is driven by its enormous consumer base. India has been witnessing notable economic growth and a rise in disposable incomes, which has led to an increased demand for toys in the country.
Several initiatives by the Government have provided a significant push to this sector. The new regulations set by the Bureau of Indian Standards (BIS) were implemented with effect from January 01, 2021, according to which, all factories producing toys in India are required to be certified by the BIS. It also mandated product testing, thereby ensuring that there is no compromise in the quality of the toys manufactured in India.
In 2021, the Indian toys market reached a value of US $ 1.35 billion, which is expected to double by 2027, exhibiting a CAGR of 12.6% from 2022 to 2027. The toy industry is estimated to reach US $ 1.5 billion, making up 0.5% of the global market share. The toy manufacturing units in India are mostly concentrated in NCR, Maharashtra, Karnataka, Tamil Nadu and clusters across central Indian states.
India’s Toy Market Trend
India has the potential to become a major export hub for electronic toys, including science, technology, engineering and math (STEM) toys and video game consoles, which are in high demand in the global toys and games market.
Toy exports from India increased from US $ 72.5 million in 2016–17 to US $ 177.0 million in 2021–22. Tricycles, scooters, pedal cars, dolls’ carriages, puzzles of all kinds and recreational toys are among the key toy categories exported from India.
India exports toys and sports goods to around 129 countries, including the USA, the UK, Germany, Mexico, and the Netherlands. In 2021–22, the US was the largest importer of Indian toys, valued at US$ 69.3 million, accounting for 39% of the total exports from the country. The other key toy export destinations include the UK and Germany, with a share of 10% and 6%, respectively.
UAE holds strong potential as an emerging market for Indian toys and India can capture the market by taking advantage of the large Indian population residing in the country.
The Road Ahead
Like other emerging industries, there are a couple of challenges faced by the Indian industry. There are limitations regarding the bidding of global licenses. To address the same, Indian companies may tie-up with global toy companies for domestic manufacturing. Also, owing to the fragmented nature of the sector, there’s a lack of a strong supply chain.
To drive growth in the industry, the need of the hour calls for expansion of the local manufacturing base, promotion of high-quality Indian toys and ensuring affordability of the products. This can be enabled by encouraging global and domestic players to build end-to-end, integrated manufacturing facilities.
The toy industry plays a vital role in generating employment opportunities for women, especially in rural households. It has the potential to create 40,000 jobs in five years and attract over US $ 627 million (INR 5,000 crore) in investments.
Inspired by Indian mythology, history and culture, manufacturers are now producing toys in abundance and these products are now being sold across the globe in collaboration with the prime global brands.
Along with the numerous Government initiatives, the growing awareness around traditional toys and local handicraft, new India’s traditional toy industry is at the cusp of extraordinary growth. Through a plethora of innovations and technical expansion, the industry is witnessing rapid transformation and is likely to become a major contributor to the Indian economy in the future. This evolution of our traditional toy industry is truly a step towards the vision of a self-reliant India.