NEW DELHI: India’s toy exports have hit the slow lane after showing spectacular rise since FY215.
After touching a peak of $177 million in FY22, exports of toys have been declining ever since. As per the data collated by the Global Trade Research Institute (GTRI), toy exports have come down to $152 million in FY24. Simultaneously, there has been a rise in imports. Toy imports have risen 81% since FY22 to $65 million.
As per the industry, the tapering off of exports could be attributed to slowdown in major markets like the US and Europe. The stagnation could be attributed to ‘cost disability’ that Indian manufacturers face due to high subsidies given to manufacturers in China and Vietnam.
Talking to TNIE, chairman of Toy Association of India Manu Gupta said that India has achieved a certain critical level of toy exports, but in order to exponentially grow from here, the industry needs to overcome the cost disability it faces due to massive subsidies offered by countries like China and Vietnam. He says in order to grow toy exports in the country, the government should consider the request for a Production-Linked Incentive scheme for the sector. He also bats for a National Toys Policy for a comprehensive boost to the sector.
Ajay Srivastava, founder, GTRI, however, attributes the stagnation in exports to the inability of quality control measures to boost exports. “While quality control measures were primarily aimed at boosting local industry and ensuring safety, they did not significantly enhance India’s toy exports,” says Srivastava of GTRI. Introduction of higher import duties and the quality control measures has impacted the toy trade in India with imports falling drastically from $304.1 million in FY19 to $64.9 million in FY24.
During the same time, exports increased modestly from $109 million to $177 million. However, by FY24, exports have decreased to $152.3 million.
While the share of imports from China dropped from 87% of India's total toy imports in FY19 to 64% in FY24, imports from other regions such as ASEAN countries, Sri Lanka, and the Czech Republic have increased during the period. Share of ASEAN countries in Indian toy imports at the end of FY24 was 16.7%, Sri Lanka 12.4%, and Czech Republic 4.7%.
According to Manu Gupta of Toy Association of India, the increase in imports can be partly attributed to illegal imports in the guise of imports of toy components.