Having survived the imported Chinese toys that nearly killed the Indian toy industry, the Rs 2,000-crore

(Rs
20 billion) domestic toy industry has come a long way. A K Bansal, chief managing director, Hanung Toys and Textiles Ltd, spoke toAshish Sinha about the turnaround of the Indian toy industry and his company's plans for the Indian market. The company's agreement with Walt Disney [ Images ] India [ Images ] allows it to manufacture soft toys resembling Disney characters like Mickey Mouse [ Images ], Donald Duck, Goofy, Nemo and Lion King among others. Why are imported Chinese toys not preferred today? There are several reasons. But primarily, imported Chinese toys are of inferior quality. Also, most of them do not conform to the quality norms. We produce stuffed toys of the highest quality standards and at competitive prices. Hence, even though the Chinese toys damaged our toy industry during 1999-2003, now it's no longer a threat. Can you summarise the damages caused to the Indian toy industry due to imported Chinese toys? During 1999-2003, India was importing almost 1.2 million toys from China every week. The domestic toy industry was traumatised by the loss of an estimated 80 per cent of its home market to the Chinese goods. According to one estimate, only 200 of the nearly 700 companies in existence survived. How is the domestic toy market placed now? There is no study on the value or the volume of domestic toy market. But industry estimates suggest that the toy market should be around Rs 2,000 crore (Rs 20 billion), of which the organised stuffed toy market accounts for about Rs 300 crore (Rs 3 billion) and is growing at over 25 per cent annually. Between Mattel, Funskool and Hanung Toys, we have about 15-18 per cent market share. What is fuelling the domestic toy market? There are three basic reasons for high growth in the stuffed toy market. Firstly, the disposable income of people has grown very fast in the last three-four years. This has led to several changes in the shopping pattern. Secondly, gifting stuffed toys has caught on in a big way. Then the mushrooming of shopping malls has also worked in our favour. And last but a very significant reason is the increase in foreign trips undertaken by a large number of people. This exposes them to international stuffed toy brands. Apart from being great gifts, stuffed toys also help people de-stress. How does your supply chain work? At the domestic front, Hanung operates through a network of more than 100 distributors. We supply our soft toys to them who then distribute the goods to multi-brand outlets including Lifestyle, Piramyd, Wellspun, Odyssey, Pantaloon [ Get Quote], Ebony, Shoppers' Stop etc.

Similarly, the home furnishing range is supplied to more than 20 distributors who in turn cater to the network of more than 600 retailers spread across India. Our products are available at 3,600 stores across India.

Click to play video New Delhi: A health concern or an economic compulsion? Following India's the ban on import of milk, milk products and chocolates from China, the Commerce ministry has announced the ban on some Chinese toys for a period of six months. The commerce secretary has told CNN IBN that, " The reason for the ban is a concern for public health. Chinese toys are known to have high content of poisonous substances like lead." International and Indian studies in the past have shown that Chinese toys contain high amounts of lead. In fact, a CNN-IBN special investigation one year ago, tested a random sample of toys for lead. The results revealed that Chinese toys contained higher levels lead than their Indian counterparts. The study also showed that the highest content of this heavy metal was in products like teethers for newborn and toddlers. However, a closer look at the categories that have been banned by the Indian government include items like tricycles, pedal cars, recreational models and puzzles. These are not necessarily toys that lend themselves to being constantly chewed or ingestedthe one way by which lead actually leaches out can cause lead poisoning in children. So it looks like the commerce ministry has other concerns. Many say this temporary ban is a means of providing protection to domestic manufacturers, against cheap competition. After all, over 70 per cent of all toys sold in India come from China. Perhaps this is the governments way of heeding distress calls of small scale toys manufactures in a tough economic market. Meanwhile chew this fact- India continues to have no safety standard of all toys in India -Chinese or Indian.

India China establish joint panel to defuse trade tension and resolve toy imports issue
with one comment India and China are in bilateral official-level talks in New Delhi. China is now Indias largest trading partner and India is Chinas 10th largest trading partner. There is a huge trade surplus favoring the Chinese side, but China says it does not intentionally seek a trade surplus with India. From the new developments it seems unlikely that China will go in for formal WTO dispute settlement on the toy imports issue. The Indian government has admitted that the safety standards applicable at present exclusively to toy imports from China, need to be extended to imports from other countries and that comparable standards need to be put into place for Indian-made toys as well. Xinhua reports: During the talks, both sides agreed to set up a joint working team to coordinate and communicate regularly on the problems of bilateral trade, said the sources The Chinese side expressed great concern over Indias frequent trade remedy probes against Chinese products, especially the prejudicial restrictive measures against Chinese toys, and asked India to avoid abusing trade remedy measures to over-protect its domestic products, and to uplift the restrictive measures on Chinese products, which were imposed merely out of prejudice and contradicted the WTO rules, said the sources. The Chinese side also hoped that the two sides should solve bilateral trade disputes through governmentto-government communications and coordination and strengthening of dialogue between the industrial sectors of the two countries, said the sources. Vice Minister Zhong said at a media conference that China reserves the right to resort to the WTO dispute solution authorities over Indias ban of Chinese toys, but still believes the two sides have the capability and wisdom to solve this problem through communications and coordinations Secretary Pillai said that according to Chinese statistics, bilateral trade between India and China has attained a volume of 51.8 billion U.S. dollars in 2008, so China has overtaken the United States as Indias largest trade partner. Pillai expressed his hope that both sides expand bilateral trade and investment, and stand up against trade protectionism, saying India is willing to solve the problem of on-going anti-dumping and anti-subsidy investigations against Chinese products through coordination at the level of the joint working team. In order to avoid possible prejudice against Chinese toys, India will also study and make up as soon as possible the safety standards for toy products, so that all imported toys and domestically made toys will all abide by the standards, he added. The Indian side also hopes that China will solve as soon as possible the problem of quarantine and safety tests for Indian agricultural products and beef products bound for Chinese market, and take concrete measures to expand import of such products from India. The Chinese side said that China does not intentionally seek trade surplus with India and wants to have a balanced development of bilateral trade and push forward the solution of the problem of quarantine for Indian food products. According to statistics of Chinese Ministry of Commerce, from October 2008 to February 2009, India has launched 17 trade remedy probes, including those of anti-dumping and anti-subsidy, against Chinese products, covering industrial salt, steel, auto parts, coal products, porcelain products, textile and rubber products, which means a total loss of more than 1.5 billion U.S. dollars for the Chinese producers and traders. Moreover, the Indian government has imposed restrictions on imports of Chinese steel, chemical and textile products and declared a six-month ban of Chinese toys in January. But due to opposition of home toy dealers, India has eased the ban on boys and allows import of products with international safety certificates.