Government to launch new scheme to boost India’s toy manufacturing sector

K N Mishra

    07/Jul/2025

What's covered under the Article:

  1. A new central scheme is in the pipeline to promote toy manufacturing, branding, and global competitiveness.

  2. India has transformed from a toy importer to an exporter to 153 countries through supportive policies and quality enforcement.

  3. MSME support and Mudra Yojana have enabled toy startups and clusters to scale up innovation and production.

In a significant policy move aimed at uplifting domestic industries, the Union Minister of Commerce & Industry, Mr. Piyush Goyal, has announced that the Government of India is close to finalising a dedicated scheme focused on the growth and promotion of the Indian toy industry. The announcement was made during his address at the 16th Toy Biz International B2B Expo 2025, held in New Delhi on July 7, 2025.

The proposed scheme will aim at boosting toy manufacturing, enhancing design and innovation, improving packaging standards, and supporting brand-building—all with the objective of making Indian toys globally competitive.

A Sector in Transition: From Importer to Exporter

Mr. Goyal stated that India’s toy sector has undergone a dramatic transformation in recent years. From being largely dependent on imports, the country has now emerged as a net exporter of toys, supplying to over 153 countries worldwide. This impressive turnaround has been made possible by a mix of:

  • Favourable policy interventions

  • Implementation of Quality Control Order (QCO)

  • Development of toy manufacturing clusters

  • Support for startups through government-backed financial schemes

The Quality Control Order (QCO), in particular, has been instrumental in pushing Indian toy makers to meet international safety and quality standards, making Indian toys marketable in global markets where compliance is critical.

Key Pillars of the New Scheme

The scheme currently under formulation will be designed with a holistic approach, encompassing every vital aspect of the toy production value chain. According to Mr. Goyal, the four key focus areas include:

  1. Design and Innovation: Strengthening the design ecosystem by supporting startups, encouraging cultural storytelling through toys, and promoting educational toys rooted in Indian heritage.

  2. Manufacturing Excellence: Providing incentives for quality-focused manufacturing practices, upgrading production technologies, and enabling manufacturers to achieve cost efficiencies at scale.

  3. Packaging Standards: Ensuring Indian toys are not only durable and safe but also visually appealing and competitive in presentation, which is crucial for retail and export markets.

  4. Brand-Building Support: Facilitating the global recognition of Indian toy brands through export assistance, international expos, digital marketing initiatives, and participation in trade fairs abroad.

Government Backing: MSME and Mudra Yojana

Mr. Goyal also highlighted the pivotal role of government schemes in fueling the toy sector’s grassroots transformation:

  • The Ministry of Micro, Small and Medium Enterprises (MSME) has actively supported the establishment of 18 toy manufacturing clusters across India. These clusters are intended to decentralize production, promote regional employment, and create localized centers of excellence for toy making.

  • Additionally, startups focused on innovative toy design and manufacturing have gained access to long-term credit via an extended version of the Pradhan Mantri Mudra Yojana. This scheme now offers collateral-free loans with up to 20-year tenure, reducing the entry barriers for young entrepreneurs in the toy segment.

India's Competitive Edge in Toy Manufacturing

According to the Union Minister, India’s large domestic population offers a robust consumer base, providing economies of scale that naturally lower production costs. This, coupled with policy-driven cost advantages, enables Indian manufacturers to compete effectively with international players.

Mr. Goyal emphasized the synergy between “Make in India” and “Design in India”. While manufacturing growth is critical, the government wants Indian toys to reflect India’s cultural richness, diverse traditions, and value-based education systems. The upcoming scheme is expected to integrate this vision deeply, enabling cultural relevance alongside commercial viability.

A Push for Global Recognition

With increasing international interest in sustainable and educational toys, India is in a prime position to claim a bigger share of the global toy market. The government is also working to ensure:

  • Enhanced export facilitation

  • Improved logistics and supply chain systems

  • Partnerships with e-commerce platforms for global reach

  • Incentives for companies achieving global certifications and sustainability benchmarks

Stakeholder Confidence and Industry Reception

The industry has welcomed the announcement positively. Manufacturers, exporters, and toy designers believe that a comprehensive scheme, with dedicated support for design, branding, and compliance, could be the inflection point for India’s toy sector. It could transform the ecosystem from fragmented cottage-level units to globally recognized players delivering high-quality toys with Indian stories.

Further details about financial outlays, eligibility criteria, and implementation timelines are expected in the coming weeks as the final touches are being put on the scheme’s framework.

Strategic Alignment with ‘Vocal for Local’

The scheme also aligns with the government’s broader mission of “Aatmanirbhar Bharat” and “Vocal for Local”, encouraging Indian consumers to choose domestically made products. By enabling Indian toy brands to build a recognizable identity, the government aims to curb unnecessary imports, boost exports, and create sustainable livelihoods across regional economies.

Conclusion

The announcement by Union Minister Piyush Goyal at the Toy Biz International B2B Expo 2025 underscores the government’s intent to elevate India’s toy sector through a dedicated scheme focused on manufacturing, design, branding, and global competitiveness.

As India continues its journey from a toy importing nation to a net exporter, the sector's next phase will be driven by policy support, innovation, and market confidence. The upcoming scheme promises to be a game changer, fostering a self-reliant, globally competitive Indian toy industry that is rooted in cultural heritage and modern design thinking.

Stakeholders, entrepreneurs, and investors alike will be keenly watching as the government finalizes and unveils this much-anticipated initiative, which has the potential to reshape the landscape of Indian toy manufacturing for the future.


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