Toy story: US orders decline 50% as tariffs hit exporters

Toy exporters may have had a strong start in this financial year, thanks to early festive shipments and front-loading by US buyers, but they are now forced to slash prices and redesign packaging as orders continue to slump with the buyers turning to other markets following imposition of 50% tariff by the US."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," said Amitabh Kharbanda, governing body member, Toy Association of India. The majority of festive, carnival or other entertainment articles are usually exported during April-August, ahead of the festive season in the US. Exports to the US, the top recipient of such goods, amounted to $64.5 million in the April-August period, achieving within five months of this fiscal 78% of the shipments worth $82.3 million in the entire 2024-25.

In the first five months of this fiscal, India's shipments of festive, carnival and other entertainment articles increased 4% year-on-year to $101.9 million. Overall, exports of toys, games and sports requisites increased 8.9% to $302.6 million in April-August against $277.8 million a year ago. The US imposed 25% tariffs on Indian products from August 1 and doubled the levy from August 27 due to India's purchases of Russian crude oil.

"Toy shipments for the US festive season typically begin in April. Following the 145% tariff on Chinese toys, customers front-loaded their orders, resulting in strong volumes in the first half of the year. However, the subsequent 50% tariff on Indian imports slowed new orders in the latter half," said KA Shabir, CEO, Funskool India. Advance buying earlier in the year has helped offset the current slowdown. Shabir said "we expect to close the year with marginal single-digit growth over last year".
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