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Global interest to source Indian toys boosts PM’s vision of ‘vocal for local’

Mann Ki Baat @100Global interest to source Indian toys boosts PM’s vision of ‘vocal for local’

For the country’s toy manufacturers who have crafted a significant success story through a 62 per cent jump in India’s export of toys in the span of last three years, and managed a 70 per cent decline in toy imports, the inflection point was Prime Minister Narendra Modi’s pitch for deploying the industry’s talent and ability to transform the nation into a toy hub. Infused by new energy and responding to Modi’s clarion call to ‘be vocal for local toys’, develop clusters and make good quality products, the industry exported toys worth USD 326.63 million in financial year 2021-22, up from USD 96.17 million in 2014-15 and USD 202 million in FY 2019, as per government and industry data.
By the time this achievement reflected in Modi’s “Mann Ki Baat” in August 2022, India had set in motion the process of “becoming a powerhouse in toy exports”, as the Prime Minister noted in his address. “The domestic toy Industry has achieved such success that no one could have imagined,” he said in the 2022 address. In fact, industry sources told The Sunday Guardian that USA’s Walmart and Italy’s Ferrero are among top global retailers from the US and Europe which have expressed interest in sourcing toys from India and in training and upscaling Indian enterprises. The Department for Promotion of Industry and Internal Trade (DPIIT), is also helping Indian manufacturers tie up with the global players to meet their compliance provisions and workshops are being organised in this regard.
Manu Gupta, Chairman of Toy Association of India and CEO of Playgro Toys Group agrees on the extraordinary progress the industry has made over the past few years. “India’s imports of toys fell to USD 109.72 million in 2021-22 from USD 371 million in FY 2019. For the financial year 2022-23, exports are already at USD 310 million till date. Despite the global recession, we hope to better that,” Gupta told The Sunday Guardian. The optimism rides on a slew of proactive policy measures by the Centre to restrict import of sub-standard and unsafe toys and boost local manufacturing which has massively benefited the industry. The basic customs duty on toys has been increased from 20% to 70% in February, 2023, and a Quality Control Order (QCO) for toys issued in February 2020 and in effect since 1 January, 2021, makes it mandatory for every toy in the market to conform to the relevant Indian standard and bear the Standard Mark under a license from Bureau of Indian Standards. The law applies to both domestic manufacturers, as well as foreign manufacturers who intend to export their toys to India.
Indeed, Asia’s fastest growing democracy has come a long way from eight odd factories set up between 1990 and 1995 to manufacture soft toys for the international market, most of which were shut down by 2000 as it was difficult to get customers to India and compete with China, an industry source told The Sunday Guardian. All eyes are now on the much awaited, an estimated Rs 3500 crore Production Linked Incentive Scheme for toys, offering a very low investment threshold of Rs 5 crore to strengthen the micro and small enterprises dominated domestic toy manufacturing sector. Besides, various states are becoming stakeholders in the national objective with the Government of Uttar Pradesh taking the lead in developing a second toy cluster, close to Jewar or Noida Airport, currently under development. “Land has been allotted to 136 participants in the cluster which has an estimated investment of Rs 7,000-Rs 8,000 crore and has great promise of global access and employment,” Gupta also told The Sunday Guardian. “The airport, with its proximity to Delhi which is in itself a toy manufacturing hub, can be a game changer for the toy industry. Considering the airport is also expected to facilitate cargo movement, access to the global market could not have been easier,” Gupta added.
According to Gupta, he Government of Karnataka along with local private developers has developed the Kopal toy cluster which is in the domestic tariff zone and foreign tariff area and is spread around 300-400 acres. The Government of Madhya Pradesh also has a state toy policy with incentives to encourage MSMEs to set up units. The Government of Tamil Nadu offers a state PLI policy and the Rajasthan Government has also come up with a mini toy cluster in Khushkhera where 20 people have been given land. The Government of Telangana has come up with a 104 acre toy cluster in the outskirts of Hyderabad.
There has been a substantial decrease of cheap imports from China but it still remains a worry, says Gupta, considering the scale of economy they have achieved which not only caters to the domestic market and a good two thirds share of the global market. “What we need to do is learn from their good manufacturing practices. We cannot be an alternative to China but we can be an additional sourcing destination,” said Gupta.
The government is not resting yet. A total of 19 toy clusters have been approved under the scheme benefitting 11,749 artisans with an outlay of Rs 55.65 crore. A comprehensive National Action Plan for Toys aims to make the Indian toy industry competitive and push the ‘Make in India’ initiative. Implementation of the plan to support toy manufacturing clusters is expected to drive toy exports from India.

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