New Delhi: Remember the last year Diwali? There was uproar on discarding use of China made products in India. Needless to say, the Chinese dragon has eaten sales and revenue share of many product manufacturers and sellers who are trading in India. The China made products have penetrated the Indian market so well that from needles to toys, electronic gadgets, consumer durables et al, you name it and you will get a Chinese version of the same product at a cheaper rate. Experts say the Chinese counterfeit products have affected not only the Indian market but also exports. Indianretailer.com speaks to a few industry veterans to know their views. Here are the excerpts of the conversations:
Sharad Venkta, MD & CEO, Toonz Retail
How Chinese products specifically, toys are impacting sales of Indian toy manufacturers? In what percentage?
Chinese products, specifically toys, have impacted sales of Indian toy manufacturers. As the price of Chinese goods is 10-70% less than Indian goods, it catches the attention of Indian customers. Some of the features that favor Chinese products over Indian goods are availability in bulk, less price, and available in variety. Chinese products affect the domestic market, along with export market. It has been seen that Indian goods have been replaced with products labeled as “Made in India”. According to report by ASSOCHAM, China enjoys the largest toy market share in the world, which is 45%, and the share of the Indian market is only 0.51%. Manufacturers in India have market share of around 30% in the toy industry; the rest is served by China. The import of Chinese toy products has also increased in the past. And, as the number of Chinese products entering the Indian market increases, it has also led to the shutdown of around 60% of the industries in the country.
In this respect, what's Toonz Retail's reaction?
Despite strict regulations on imports from China, we are more dependent on them due to production capacity, cost and quality factors. We have very handful of Indian players manufacturing toys in India but are faced with external and internal policy challenges which makes us further more reliant on China. It is important for us, as a brand to create awareness about our products. As most of the toys sold here are of Chinese origin and lack in quality, we are looking at expanding and plan to come up with campaigns – something that kids can identify with.
How the interest of Indian toy manufacturers can be safeguarded and what Govt of India should do?
Government should encourage local small business enterprises to reduce the foreign goods in the market. To safeguard the domestic manufacturers from the Chinese goods there is a dire need to change the policies and add duties.
Government should motivate and incentivize Indian manufacturers.
1. Recently very Lower LOI now been passed to small &mid scale players. This has to be relaxed for genuine players.
2. BIS certification : It’s a good move but the process is very tedious and costly
3. Provide better solutions on Factory setup and manufacturing capabilities.
Nirav Patel, CMD, Abaj Electronics Pvt. Ltd
Be it anything from a needle to toys, electronic gadgets, consumer durables, you will find the Chinese version of the same in India at a much cheaper price. The price of Chinese goods is 10-70% lower than that of Indian goods. Low price, bulk availability, and variety are some of the favourable features of the Chinese goods in India. Chinese products in huge quantity are put into the Indian market and adversely affecting the Indian units. Chinese goods are not only affecting the domestic business and Indian market but also affecting the export market of our country. Indian goods are being replaced by ‘Made in China’ label both in India as well as abroad. Made in China label is slowly capturing every segment of Indian market. The need of the hour is to support "Make in India" Initiative and boycott the usage of Chinese products.
Consumer durables market in India reached Rs 1 trillion (US$ 15.45 billion) in 2017. The industry is expected to grow at 13 percent CAGR and reach Rs 3 trillion (US$ 46.54 billion) by 2020. Urban markets account for the major share (65 percent) of total revenues in the consumer durables sector in India. There is a lot of scope for growth from rural markets with consumption expected to grow in these areas as penetration of brands increases. Also, demand for durables like refrigerators as well as consumer electronic goods is likely to witness growing demand in the coming years in the rural markets as the government plans to invest significantly in rural electrification. Growing awareness, easier access, and changing lifestyles have been the key growth drivers for the consumer market.
(This article will be updated)