From Weak to peak - India's toy story!

-- Mr Sunoj Nambiar

Wednesday, January 18, 2023

As an individual who also enjoy trading in the Indian market, it's my habit to follow the financial news, especially the growth sectors. While scrolling through my Twitter screen, I got excited by a tweet which says that India's toy exports have gone from 300 crores to 2600 crore in just two years!!! What! As a person who visits Channapatna, a famous toy village in Karnataka, for most of my vacation, I always used to wonder why can't I see any Channapatna toys here in Kuwait! This initiated my intuition to look in detail at that tweet to understand the amazing growth story of India's toy market.

It's a fact that we all are familiar with the Chinese toys that flooded the market, whether in India or here in Kuwait. Even though India has a rich legacy in toy-making and storytelling through toys, it is a fact that our market was flooded with cheap Chinese toys. It is not that we don't have good toys. I was always amazed by the Channapatna toys, which are made of 'soft' ivory wood and made using non-toxic, non-chemical colours, which they make themselves. The fact that it has no sharp edges, doesn't use any nails or screws, ensures that these toys are safe for children of all ages. But that fact is that it remains an unorganized sector in India.

In the year 2020, the Hon'ble PM Narendra Modi made a clarion call to uplift the Indian toy industry and little we knew that things would really change so fast.

Several drawbacks have kept the Indian toy industry from achieving its true potential of emerging into a global phenomenon. This includes a lack of research and development in this sector by experts, design quality and innovation, lack of professional training for its workers and proper marketing plans. While China dominates the electronic toys segment with innovative products, India desperately went behind in such innovation.

However, things were turned down after the clarion call by our Prime Minister. The government followed several steps to successfully implement this. In February 2020, the government hiked customs duty on toys from 20% to 60%. In January 2021, the India government implemented regulations (Toys Quality Control - TQC) which state that toys for children under 14 years of age must conform to 7 Indian Standards and must have ISI mark.

The government launched a Toy Fair in 2021, which opened the door for Indian toy manufacturers to showcase their potential to the international market. The 'vocal for local' call by the central government boosted the market for Indian toy manufacturers, and the result is there on paper.

In the last two years, toy imports to India have dropped 70%, from 371 million USD in FY19 to 110 million USD in FY22. The imports of toys from China alone witnessed a drop of 80% to 59 million USD, and India's toy exports have increased 61.4% to 326 million USD by FY22.

The measures taken so far are a very small beginning in self-reliance. India has the potential to become a major export hub for electronic toys. By providing the required skill training to the local artisans in the country, we can help them meet the industry's evolving demands. By taking advantage of the large Indian population in the Gulf states, India can easily capture the gulf market, which is still dominated by Chinese products. While the toy story is running from weak to peak, let us all remind our self and proud about our 'Aatmanirbhar Bharath'.

Mr Sunoj Nambiar ,Founder and Director of www.IndiansinKuwait.com.