Strategic Focus by Govt. and De-risking Supply Chains Presents 2X Opportunity for India in Global Toys Market by 2025: FICCI-KPMG
02 October 2021: Indian toy market, which is currently estimated at USD1 billion, presents a 2x growth opportunity by 2025, according to FICCI-KPMG Report. in India’s report. It presents a detailed overview of the Indian toy industry focusing both on demand and supply-side measures needed to make India a global toy manufacturing hub. India could also target a 2% share of global exports by 2025 as per the report. There is high growth potential for India in exports of plastic toys and board games in USA, EU and Middle East among other markets.
Toys have been an integral part of Indian culture and heritage. While the desire to play is as unabated today as ever before, the global toy industry has come a long way. The nature and techniques of play are fast evolving, keeping pace with changes in technology and market demands. Toys categories such as Dolls, Soft toys, Baby & Infant and Pre-school are highly labor intensive with good potential for manufacturing capabilities in India and easy to penetrate export market, except for items that require decorations and similar value additions where the productivity levels are significantly lower (30-40 per cent) than China.
The report observed that digital & technology advancement in toys is leading to rising application of Artificial Intelligence (AI), especially in STEM Toys. India has limited manufacturing capability in battery operated, electronic and technology-based toys but can be scaled up in medium to long-term period. Labor intensive sub-segments constituting 50-60% of toys market can scale up immediately in India, giving an indigenization push to these segments which could, therefore, provide enormous impetus to job creation. There is also a significant scope for growth in gross value addition with inclusion of unregistered units in India.
States across the country are spearheading initiatives to nurture toy manufacturing ecosystems as well as developing and marketing new toy clusters, heralding a significant change in domestic toy manufacturing. Promoting quality toys and maintaining the affordability of those quality products are the two key pillars. The desired model for India is to incentivize global as well as domestic players to build end-to-end, integrated manufacturing facilities.
Vivek Jhangiani, Chairman FICCI Toy sector Committee said, “For a child to develop, it is important that play is integral to their life. The toy industry has a critical role in bringing play to every child of every strata in India, by delivering quality toys at affordable price points. This report provides an important information foundation on a hitherto unorganized industry which can be revolutionized into a large innovative and organized industry that meets the needs of children not only in India, but throughout the world.”