Things are looking up for local toy manufacturers with the government PLI plan. But a lot more needs to be done to meet the challenges of the sector and reduce import dependency for components
Dolls being assembled at the Hosur, Tamil Nadu, plant of Micro Plastics, one of the largest toy exporters in India. The company has six plants only for toys in and around Bengaluru with about 1.2 million square feet of manufacturing space
Image: Courtesy Micro Plastics
India’s toy manufacturing sector is approximately $1.35 billion, which accounts for only 0.5 percent of the global market. According to a Research and Markets report, the industry is expected to grow to $2.73 billion by 2027, at a compound annual growth rate (CAGR) of 12 percent.
Exports of Indian toys are at $326.63 million for FY22, up from $96.17 million in FY15, said Bhanu Pratap Singh Verma, Union minister of state for micro, small and medium enterprises (MSME), in a written reply to the Lok Sabha. Toy imports fell to $109.72 million in 2021-22 from $332.55 million in 2014-15.
Currently, the toy sector is highly fragmented, with only a handful of large players, and multiple SMEs and MSMEs. This is expected to change soon. The government, as per media reports, plans to launch a ₹3,500-crore production-linked incentive (PLI) scheme for Indian toy manufacturers. This scheme will be for finished toys—and not toy components—that comply with Bureau of Indian Standards (BIS) norms.
Gupta adds, “The scheme will help create mass, which will get more foreign buyers to come down to India. Toys are sold in breadth, which means you need a range of items and many more players, to fulfil the buyers’ demand.”
(This story appears in the 27 January, 2023 issue of Forbes India. To visit our Archives, click here.)