India’s educational toys sector: Trends, challenges and prospects

The ‘Father of Child-centred Therapy’, Dr Garry Landreth (1937-2026), famously said that ‘toys are children’s words and play is their language’. This reflects the lifelong association of a person with toys, cutting across international borders and cultural barriers.

Toys are not only playthings for amusement regardless of one’s age group, but also help with education and learning. Therefore, toys—especially educational toys—are increasingly emerging as key tools for edification, creativity and innovation. Though India is not among the top five exporters of toys in the world, it is continuously striving to gain a visible foothold in the global markets. 

In 2025, the market for educational toys in India was valued at $2,331.17 million. The market is expected to increase at a CAGR of 8.14 per cent from 2026 to 2034, reaching $4,714.98 million.

Strong government policy support from the National Education Policy (NEP) 2020, which mandates fun-filled learning, growing demand for STEM and technology-integrated educational toys with AI and interactive features, and quick commerce platforms that allow for 10-minute toy deliveries in urban areas are currently the main drivers of this market.

The market share for educational toys in India is also being driven by rising parental awareness of early childhood cognitive development, rising disposable incomes among the developing middle class, and the trend towards high-end educational products.             

Key market trends

First, government programmes like Make in India and NEP 2020 have provided meaningful support to stakeholders in the educational toys sector.

With a focus on pedagogical improvements and industrial incentives, the government has put in place extensive policy frameworks that may drastically alter the educational toy market for the better. By specifically mandating the inclusion of play-based and activity-based learning approaches in formal curricula for kids up to eight years old, the NEP marks a turning point and institutionalises the need for educational toys in early childhood.

In addition to raising parental knowledge of the developmental advantages of regulated play, this policy mandate has prompted significant infrastructure investments by educational institutions looking for conforming learning materials. These concerted interventions resulted in toy imports falling by more than 70 per cent from $371 million in FY19 to $110 million in FY22, which also sparked a 240 per cent increase in exports within the same time frame.

By building both institutional procurement channels and strong domestic supply capabilities, the combination of industrial policy and educational objectives generates sustained momentum for the growth of the Indian educational toy sector.

Second, as parents place a greater emphasis on their children’s cognitive skill development and future-ready competencies in an increasingly competitive academic environment, the Indian educational toy market is seeing a noticeable shift towards STEM (science, technology, engineering, and mathematics) learning products. Companies are increasingly combining physical STEM toys with digital learning subscriptions to offer integrated learning experiences as a result of the growth of edtech platforms and children’s coding boot camps.

Beyond simple electronic features, technology integration now includes sophisticated features like voice recognition for interactive conversations, augmented reality overlays that turn physical toys into immersive digital experiences, artificial intelligence that adjusts to individual learning patterns, and app connectivity that lets parents monitor developmental progress metrics. 

Third, the growth and penetration of e-commerce and quick commerce across Tier 2 and 3 cities in India have given an impetus to educational toys. With online channels growing at an exponential rate that greatly exceeds traditional brick-and-mortar distribution networks, the digital transformation of toy retail is radically changing consumer buying habits and market access patterns.

Due to a number of convergent factors, such as smartphone penetration exceeding 800 million users, growing digital payment adoption made possible by UPI infrastructure, and consumer preference for the convenience and product variety provided by e-commerce platforms, online sales of educational toys are accelerating. With quick commerce offering almost instant delivery windows that drastically change the value proposition compared to traditional e-commerce players requiring 3-4 days for fulfilment, the rise of 10-minute delivery segments is an especially disruptive innovation, driving growth of educational toys market in India.

Fourth, with the blending of traditional Indian designs, local art, and indigenous knowledge systems with modern learning frameworks, the growth in the country’s educational toys market is quite guaranteed.

Lastly, consumer preferences for sustainable, non-toxic, and wooden toys over cheap plastics are growing, and this has given an impetus to the domestic educational toys market. 

Major challenges

Despite the many positive growth trends associated with the country’s educational toys market, the sector is also beset with notable challenges for the present and future.

First, there could be high initial tooling expenses for local micro, small, and medium enterprises (MSMEs) trying to scale up their production. Second, the strict enforcement of Bureau of Indian Standards (BIS) quality control orders has weeded out unbranded, cheap imports but temporarily raised production and compliance costs for small local artisans. Third, traditional artisan clusters may face gaps in unified design capabilities and direct market access. Fourth, the Indian educational toys market is highly price-sensitive due to income disparities and the prevalence of unorganised manufacturers, who use informal structures to minimise costs by importing low-cost components from China.

Urban middle-class families in India typically prefer value-oriented products, reserving their premium purchases for special occasions. Organised companies face a choice between maintaining high prices with limited market penetration and adopting aggressive pricing to drive volume, potentially harming profitability and brand equity.

Furthermore, weak intellectual property enforcement enables unorganised manufacturers to replicate designs without R&D expenses, distorting this competitive landscape.

The rural landscape of India encounters significant challenges in distributing educational toys, primarily due to poor retail infrastructure, last-mile connectivity issues, and insufficient storage facilities. Additionally, fragmented demand in small villages complicates distribution efforts. E-commerce faces further issues, including time-consuming postal services, limited smartphone penetration, preference for cash transactions, and customers’ reluctance to buy without physical inspection.

Moreover, low awareness among parents about the benefits of educational toys is compounded by lower education levels and traditional beliefs favouring academic instruction over play-based learning.

Future prospects

First, the Make in India and Atmanirbhar Bharat initiatives continue to favour domestic manufacturers, lowering dependency on external markets and boosting local toy exports, including educational toy exports.

Second, with schools and pre-schools increasingly adopting experiential, play-based learning frameworks—thereby driving institutional and home demand—the market size for educational toys in the country could expand further.

In addition to that, AI-powered technologies, augmented reality (AR) adoption, sustainable clean-label launches, and the expansion of quick commerce platforms could be the much-needed boost that the country’s educational toys sector requires in the coming years. This would make the learning experience truly enjoyable and memorable for students of all ages.

Lastly, the country’s toy industry could gain larger access to global markets such as Australia, Brazil, Canada, the European Union (EU), the Gulf Cooperation Council (GCC), Indonesia, Mexico, New Zealand, and the UK with the help of FTAs that have already been signed or are in the pipeline.

Pleasant Rowland, the founder of American Girl, once said: “Toys are the seeds from which the tree of creativity grows. Nourish them well, and watch imagination bloom.” 

Educational toys in India could prove to be those very seeds from which the trees of creativity could grow in all generations and help boost exports from the sector.

The author is Assistant Professor (Economics and Trade Policy), Indian Institute of Foreign Trade, New Delhi.

The opinions expressed in this article are those of the author and do not purport to reflect the opinions or views of THE WEEK.