₹13,000 crore mega plan taking shape to make India a global toy hub

Under the proposed scheme, the types of incentives are being planned - Turnover Linked Incentive (TLI), Localisation Linked Incentive (LLI) and Employment Linked Incentives (ELI) are being planned

The government is developing a mega scheme to support toy manufacturers with financial assistance for new employees they hire, aiming to boost job creation in the sector.

 

Spearheaded by the Department for Promotion of Industry and Internal Trade (DPIIT), a broad ₹13,000 crore scheme aimed at transforming India into a global toy manufacturing hub, while addressing the challenges of India’s high reliance on imports and cost disadvantage compared to global behemoths in China and Vietnam.

 

The scheme, if approved by the Union Cabinet, will see targeted financial incentives for domestic manufacturing of toys as well as specified raw materials, according to people aware of the matter.  

The broader scheme is expected to feature three types of incentives — Turnover-linked incentive (TLI), localisation-linked incentive (LLI). Similarly, under employment-linked incentive (ELI), manufacturers will get financial incentives for employees hired, subject to a certain cap. For instance, under the TLI component, incentives will be disbursed to eligible companies that achieve incremental investment and sales over government-determined base year. The LLI will reward companies if a certain share of raw materials is manufactured in the country.

 

Additionally, there will be a provision for concessional basic customs duty in the case of investment commitment of over Rs 500 crore, provided that conditions such as incremental investment, sales threshold, domestic value addition, and exports criteria are met, they said.

 

The initiative to come up with such a scheme came against the backdrop of finance minister Nirmala Sitharaman’s announcement in the Union Budget FY26 to build a national action plan for toys. In the past, DPIIT had proposed a production-linked incentive (PLI) scheme worth ₹3,489 crore. However, the scheme did not see the light of the day as top government officials believed that new schemes should be rolled out after assessing the efficacy of the existing 14 PLI schemes. 

 

One of the persons cited above said that the scheme is still at a discussion stage. Inter-ministerial consultation is yet to be concluded. However, there is an attempt to get all the required approvals and implement the scheme at the earliest, informed a government official.

  DPIIT did not respond to the queries sent by Business Standard on the proposed scheme.

 

Through specific interventions under the scheme, the government aims to position India as a key player in the global toy market, while meeting local and international demand. Apart from boosting local manufacturing, the scheme will help India’s integration into the global value chain.