India’s Toy Industry

Context:

?   As per the recent official press release, the toy industry became a net exporter between FY 2014-15 and FY 2022-23.

?    Its exports increased by 239% and imports declined by 52%, turning India into a net exporter

Indian Toy Industry

?   The Indian toy industry is among the fastest-growing globally, projected to reach $3Bn by 2028.

?   Domestic market size currently stands at an estimated value of $1.5Bn. The sector is dominated by small & medium sized manufacturers.

?   Labor-intensive toy categories like dolls, soft toys and board games offer significant manufacturing potential in India due to inherent cost competitiveness and growing demand.

?   It is expanding its global presence, with increased high-value exports to Middle East and African countries.

?   The toy manufacturers in India are mostly located in NCR, Maharashtra, Karnataka, Tamil Nadu, and clusters across central Indian states.

How India became a net exporter?

?   India followed an inward-oriented industrial policy in the Planning era, which sheltered domestic production by providing a ‘double protection’ — by import tariffs and reservation of the product for exclusive production in the small-scale sector — known as the ‘reservation policy’.

?   Import Curb (Protectionism): Basic Customs Duty (BCD) on toys was increased from 20% to 60% in February 2020, and subsequently to 70% in Budget 2023.