Tamil Nadu Unveils Toy Manufacturing Policy 2025

Tamil Nadu has introduced its Toy Manufacturing Policy 2025 to attract new investments and promote domestic diversification into this emerging sector. Released at the Tamil Nadu Investors Conclave in Madurai, the policy positions the State as a high-potential hub for advanced and electromechanical toy production.

Policy Vision and Investment Criteria

The policy identifies toy manufacturing as a sunrise sector under the Tamil Nadu Industrial Policy 2021. New or expansion projects investing over ₹50 crore and creating at least 50 jobs will qualify for a special incentives package. These commitments must be completed within the standard investment period of three years to retain eligibility.

District-Based Subsidy Structure

Units in eligible categories located in B and C districts with investments of ₹300 crore or more will qualify for the Structured Package of Assistance under TNIP 2021. Subsidy rates differ by district tier: 7 per cent of fixed capital subsidy for A districts over five years, 10 per cent for B districts over ten years, and 12 per cent for C districts over ten years. Subsidies will be disbursed annually upon commencement of operations and fulfilment of commitments.

Flexibility in Incentive Selection

Companies may choose between the “Special Package of Incentives for Toy Manufacturing” or the broader “Special Incentives for Sunrise Sector,” depending on which policy they meet. This dual-option structure allows manufacturers to align benefits with their scale, location and strategic needs.

Exam Oriented Facts

• Toy manufacturing recognised as a sunrise sector under Tamil Nadu Industrial Policy 2021.
• Projects must invest over ₹50 crore and generate 50 jobs to qualify for special incentives.
• Subsidy rates: 7% (A districts), 10% (B districts), 12% (C districts).
• Creative design studios eligible for 30% payroll subsidy for 12 months.

Support for Design, Training and Traditional Toy Clusters

Additional subsidies support training programmes and designer development. Creative design studios focused on toy design or R&D will receive a 30 per cent payroll subsidy for new Tamil Nadu hires, capped at ₹10,000 per employee per month. The MSME department will facilitate onboarding of artisanal toy products onto major e-commerce platforms. To promote GI recognition, toy clusters will receive financial assistance up to ₹3 lakh per category for securing geographical indication tags.