Toys Market: Make in India alters the rules of the game

For a very long time, China had enjoyed supremacy in the toy market of the world. Owing to its cheap products, it flooded the markets of all the major economies. This destroyed the local artisans and indigenous small toy manufacturers. Through these toys and cheap products, China pushed its soft power and propaganda. It washed out the games and toys depicting rich Indian stories, historic icons and events among other local folklores. Finally, Chinese hegemony in the toy market has been broken by Indian toy manufacturers. India’s aggressive and bold Make-In-India initiative has kicked the Paper Dragon from the Indian toy market and will soon do the same in the global arena.

No more China’s ‘toying’ around

China has always been accused of dumping cheap products to capture foreign markets. Additionally, it indulges in privacy and data theft among other allegations. These sinister plans of China have always been opposed by the local citizens all over the world. In India, the eternal demand for boycotting cheap Chinese goods gained steam after their misadventure in the Galwan Valley. Since then, the Paper Dragon has been paying a heavy price for its false bravado.

Along with a quadrupled military response, India is kicking China out of all sectors of our economy. These actions against China, coupled with the government’s push to strengthen our domestic manufacturers, are now bearing fruits. Evidently, the data published by the Ministry of Commerce and Industry on the net import and export of toys reflect a very rosy picture.

In the last three years alone, Make-In-India has been pivotal in toy manufacturing in the country. It has resulted in a massive drop of around 70% in toy imports. At the same time, India has been successful in registering a quantum jump of 61% in exporting toys to the world.

Import and Export Numbers

According to the Ministry’s data, the import of toys has registered a sharp decline of 70% as compared to the Financial Year (FY) 2018-2019. A standardised nomenclature is used to classify traded products. It is termed as Harmonised Community (HC) code. For HC codes 9503, 9504, and 9505, the import of toys to India has reduced from USD 371 Mn in FY 2018-19 to USD 110 Mn in FY 2021-22. This means the import has witnessed an effective fall of 70.35 per cent. The drop is even faster for HS Code 9503. The toy imports for HS code 9503 have decreased from USD 304 Mn in FY 2018-19 to USD 36 Mn in FY 2021-22.

Additionally, exports have jumped by 61.38% in the same time frame of three years. For HS Codes 9503, 9504, and 9505, the export of toys has increased from USD 202 Mn in FY 2018-19 to USD 326 Mn in FY 2021-22. With this India has registered a humongous growth of 61.39 per cent in toy export. For HS Code 9503, exports of Toys have increased from USD 109 Mn in FY 2018-19 to USD 177 Mn in FY 2021-22.

Piyush Goyal, Minister of Commerce and Industry, tweeted about this massive achievement. He lauded PM Modi’s call for citizens to be ‘vocal for local’.

What a turnaround!
Our toy imports shrink by a massive 70% and exports shoot up by 61% in the last 3 years.
PM @NarendraModi ji's clarion call of 'Vocal For Local' is transforming India's toy sector.
📖https://t.co/PgxjC4LfNi pic.twitter.com/8woOEcOG5X
— Piyush Goyal (@PiyushGoyal) July 6, 2022

13th Edition of Toy BIZ

Additional Secretary of DPIIT, Anil Agrawal addressed the media during the 13th Edition of Toy Biz B2B (Business to Business) International Exhibition. The three-day event was held at Pragati Maidan, New Delhi. TOY BIZ attracted 96 exhibitors with ‘Made In India’ products manufactured domestically by small, medium and large enterprises.

The exhibition showcased toys based on Indian ethos & value system duly endorsing the ‘Vocal for Local’ theme. Each toy category had affordable and high-end versions. This was a major shift from the 12th edition of the exhibition held in 2019. Back then, out of 116 stalls, 90 stalls exhibited only imported toys.

All the 96 exhibitors showcased the diverse product category ranging from traditional plush toys, construction equipment toys, dolls, building block toys, board games, puzzles, electronic toys, educational toys, ride-ons, etc. All the toy products were ‘Made In India’ products manufactured domestically by small, medium and large enterprises. The Toys bearing GI tag such as Channapatna, Varanasi etc. were also displayed at the grand event showcasing Indian toys.

Government’s initiatives to boost Make in India toys

Additional Secretary, Anil Agarwal highlighted several occasions when the Union government made interventions to help boost domestic manufacturing in India.

In his address, Mr Agarwal remembered PM Modi’s address to the nation through his monthly “Mann ki Baat”.

He said that in his address in “Mann ki Baat” in August 2020, Prime Minister had given a clarion call on “Rebranding the Indian Toy Story”. PM had emphasised on the availability of the right kind of toys for children, using toys as a learning resource, and designing toys based on an Indian value system, Indian history, and culture to strengthen domestic design and position India as a global manufacturing hub for toys.

Mr Agarwal added the industry had benefited from a number of interventions by the government and results show the success of the Make-in-India programme. He also added that the imports were mainly restricted to some components of the toys.

To put a restriction on Chinese toys entering the Indian market, the government raised Basic Custom Duty (BCD) on Toys-HS Code 9503 from 20% to a high of 60% in February of 2020.

Earlier, in December 2019, the Directorate General of Foreign Trade (DGFT) made it mandatory to test the sample of each consignment and failure in case of quality test was either sent back or destroyed at the expense of the importer. In 2020, the government issued a Toys (Quality Control) order (QCO). This brought toys under the compulsory Bureau of Indian Standards (BIS) certificate.

With these testing and quality checks, the government standardised the Indian toy market and, in a way, paved the way for the exit of cheap and faulty Chinese toy makers. Later, the government amended and eased the rules of QCO to exempt local artisans and small toy manufacturers. For boosting local toy manufacturing the BIS issued 843 licences to domestic manufacturers for the safety of toys. In contrast, it gave 6 licences to foreign toy manufacturers.

This success of Make-in-India in the toy sector must have sent a chilling signal to the Paper Dragon, China. Make in India’s success will soon be replicated in other spheres of the economy and China, which is already feeling the economic pain, will realise the cost of messing with India. With a stronghold on the domestic market, Indian manufacturers can target new markets in Africa and other developing nations, which will decimate the Chinese hegemony in the toy market of the world forever.