Indian toy exporters face 50% order decline amid US tariffs
What's the story
Indian toy exporters are witnessing a major drop in orders from the US, with a staggering 50% decline. The fall is attributed to rising tariffs, which have pushed buyers to look for alternatives in countries like China and Vietnam. In an effort to stay competitive, exporters are now cutting prices and simplifying their designs.
Tariff effects
US tariffs impact Indian toy exports
Amitabh Kharbanda, a member of the governing body of the Toy Association of India, said that "toy orders from the US for the next festive season, which we usually receive by October-November, are down by 50% this year as customers are shifting to China or other countries." The majority of festive and entertainment articles are usually exported between April and August.
Export statistics
For Indian toy exports, US remains top market
The US is the biggest market for Indian toy exporters. From April to August this year, India exported $64.5 million worth of festive and entertainment articles to the US. This amount is 78% of the total shipments worth $82.3 million in FY 2024-25 within just five months. Overall, India's exports of toys, games and sports requisites increased by 8.9% to $302.6 million during this period compared to last year's $277.8 million.
Tariff details
Tariffs on Indian products and their impact
The US imposed a 25% tariff on Indian products from August 1, which was doubled on August 27. The hike was due to India's purchase of Russian crude oil. KA Shabir, CEO of Funskool India, said "toy shipments for the US festive season typically begin in April." He noted that after the 145% tariff on Chinese toys, customers front-loaded their orders resulting in strong volumes in H1. However, the subsequent 50% tariff on Indian imports slowed new orders in H2.
Market adaptation
Indian toy exporters adapt to changing market conditions
To cope with the rising costs due to tariffs, toy manufacturers are moving toward simpler packaging, fewer features, and smaller toys. A Delhi-based toy exporter said that they have had to make some changes in their products as clients are asking for more discounts. "The absence of that may lead to business moving to Vietnam," he added.