Retailers of toys are planning to meet Union Commerce Minister Piyush Goyal to highlight their plight and seek a review of the hike in import duty on toys from 20% to 60% .
Addressing a press conference on Monday Farooq Shabdi, president, United Toys Association said, “The toy industry in India is on the verge of dying. Because of the duty rise, the prices of the products will go up by 100% and no one will be buying from us. Our business is going to suffer.”
The retailers under the banner of United Toys Association said that the duty hike will result in rise in prices by up to 100% in the maximum retail price (MRP) of the existing range of imported toys in India.
Finance Minister Nirmala Sitharaman, while presenting the Union Budget, had announced a rise in the import duty on toys from 20% to 60%. This has been opposed by importers and local traders. Clarifying that they were not against the Make in India initiative of the government, Mr. Shabdi said that Indian manufacturers are not yet well-equipped to compete with imported toys.
“About 85% of the annual toys requirement of India is met by imported toys and 70% of the import is from China,” he said adding that China was part of a global market which makes it easier for them to recover the capital investment made on moulds and other technologically advanced machineries by making their products available on a global platform.
“India, on the other hand, has a local market for these products and it will take much longer to overcome the expenditure and earn profits,” he said.
Gulshan Asija, spokesperson of the association, said the government brought about these changes with good intention, but it did not consider all aspects of the story. “Only a few manufacturers’ suggestions were taken, and importers and traders did not get proper representation in the discussion,” he said.
Mr. Shabdi explained that the duty hike will not lead to rise in government revenue, but will affect the employment and progress of children in India. “It is estimated that within three to four months, the existing stock of imported toys will dry up,” he said.