Bolstering Demand
for Sports Goods
(Jalandhar, Punjab)
India’s sports goods industry - An overview
India is one of Asia’s top producers of sporting goods and
equipment, ranking third after China and Japan
During 2021-22, India exported sporting goods of total worth
US$ 546 million, a significant increase from the last year's
exports valued at US$ 402.44 million
India is one of the leading international sourcing destinations
for inflatable balls and other sports goods for global brands
such as Mitre, Lotto, Umbro, and Wilson
India currently manufactures more than 300 sports-related
goods such as sportswear goods, fishing articles, outdoor
games, toys, etc. to more than 200 countries
India's Sports Equipment and Apparel Market is estimated to
be USD 27.89 Bn in 2022 and is expected to reach USD 40.64
Bn by 2027 (Research and Markets.com)
Opportunities abound in Jalandhar, Punjab – India’s top
producer of sports goods and equipment
Jalandhar in Punjab claims around 70% of the total production of sports goods in India. The evolution of this cluster was a result
of partition of India in 1947 when the people of Sialkot, Pakistan (major production center of sports goods then and now also)
migrated to the city of Jalandhar
There are about 250 exporting units, around 1000 manufacturing units for domestic markets, and some 4000 micro enterprises.
In addition, there are around 20,000 household units located in and around the city
Together these MSMEs employ around 1 lakh workers directly or indirectly. The turnover of this cluster is approximately Rs 2000
crores (unofficial figure) catering to domestic and export markets
The major products of this cluster are inflatable balls which include football, rugby ball, basket ball, etc., wood based equipment
comprising of cricket bat, hockey stick, carom board, chess board etc., protective equipment for cricket, hockey, rugby such as
gloves, shin guards, chest guards and racquets and shuttle cocks among the 200 odd items this cluster manufactures
With about 115 exporting enterprises, the cluster significantly contributes to the sports goods exports from India. In the year
2000-2001 the exports measured 320 crores, which increased to 585 crores in the year 2008-09 and further increased to 1500
crores in 2016-17
And yet the region battles immense challenges that hinder
its growth potential
The wrath of the Covid-19 Pandemic was harrowing for all sectors of the economy but the sporting goods industry in particular,
suffered a huge blow – export orders were halted, international sports events were canceled and even domestic demand
plummeted owing to the multiple lockdowns in the country
While the pandemic was a major reason behind the industry going through a slowdown, there are major issues that the industry
suffers from internally…
Fierce competition from
Unavailability of skilled neighbours
labor
Ccountries like Pakistan and
Jalandhar is facing an acute Obsolete Machinery Vietnam, that have
shortage of skilled labor Difficulty in obtaining
The global demand for machine- successfully transitioned into standards and
which has started hitting stitched sports goods has risen in mechanized production of certifications
production. While earlier recent years with handstitched football have emerged as key
competitors for India in the Sports goods
badminton, tennis and goods witnessing a slump.
export market in the recent exporters need to conform
squash goods order got lost Majority of sports goods with various standards before
years. Pakistan has in fact
to Taiwan, now cricket balls production in Jalandhar is still emerged as a top supplier to exporting to the developed
dependent on outdated major football events, markets. However, obtaining
and hockey goods are being these certifications entail huge
techniques and is losing business including FIFA events
lost to China due to shortage to competitors. India’s lost share costs, which are often
and Olympics
of in Football exports is a case in prohibitive for the MSMEs
skilled labor in the country point, the export share fell from operating in the city. For eg:
12% in 2010 to
FIFA’s Quality certifications
involve fees in the range of
almost 1.5% in 2019 due to lack Rs. 2.6 lakhs to Rs. 3.5 lakh,
of mechanized production which many small players
techniques are often unable to bear
Requisite measures to bolster demand
potential of the industry
Owing to fierce competition from international markets, there is a dire need for mechanization and technological
adoption in the industry. As most firms in sports goods clusters are MSMEs with limited capacity for such
investments, the Government may consider providing capital subsidy to companies for promoting mechanization.
Investment in State-of-the-art common infrastructure facilities also need to be developed in more sports goods clusters across the
technology and country
machinery
Owing to the huge costs involved, many small players are often unable to get international certifications. To improve
market access for sports goods exports, the Government could consider providing a refund of expenses incurred
on obtaining quality certifications, to the extent of 50% of expenses incurred by exporters, subject to a ceiling per
Gov aid in obtain- exporting unit. This will reduce the financial burden and improve competitiveness of sports goods exports from
ning international India
certifications
There is also a need for diversification of sports goods exports from the country. Indian companies are currently
focusing on traditional areas of competence, which are trite goods (such as balls) fetching low values in the
international market. A gradual diversification towards high value, equipment intensive goods (such as golf
Diversification equipment) would allow firms to move higher up in the value chain, face less competition from low-cost suppliers,
of sports and fetch higher margins
goods
Contd.
Owing to the acute shortage of skilled labor in the industry, there’s a need to inculcate awareness among the
younger generation towards the employment opportunities present in the sector. Use of info commercials, university
programs and certifications as well as investments in R&D will prove to be beneficial in attracting the youth towards
Building this avenue
awareness
among
youth
The Khelo India program, for which a budget of IN 1756 crore was set aside, was one of the government’s initiatives
that it developed in the year 2020. This pan-Indian program was primarily intended to draw foreign investment
while also generating income, recognizing, and nurturing the nation's sporting talent, and creating jobs. Such niche
programs indirectly provide impetus to the sports goods manufacturing industry and more such schemes should be
Government developed
schemes
and tie ups
For the development and exposure of Indian sporting goods, the Sports Goods Export Promotion Council (SGEPC)
should tie-up with major e-commerce players to tap onto online and digital markets. Prominent Indian sporting
goods manufacturing companies like Cosco India and Nivia Sports Pvt Ltd should be promoted by focusing on brand
Online retail building via TV commercials and print media, internet, social media platforms, team sponsorships, and partnerships
and local brand with the athletes of various sports and fitness enthusiasts
building
A ray of hope for the future…
As per India Exim Bank estimates, the sports goods industry has an untapped export potential of US$ 227.4 million,
which if realized, could help exports from the sector reach the US$ 500 million mark. The time is ripe for India to
push for appropriate incentive structure to address the challenges in the sports goods sector, enhance domestic
capabilities and improve export competitiveness
Gov initiatives such as the ODOP scheme, Market Development Assistance (MDA) Scheme and Market Access
Initiative (MIA) Scheme would help to achieve these objectives and fuel India’s growth story
Tapping onto the potential of diversified sports goods, incentive schemes and investments in research and
development as well as setting up of training institutes would help give the industry the requisite push it needs
THANK YOU!
