On August 20, the Lok Sabha passed The Promotion and Regulation of Online Gaming Bill, 2025. This legislation represents not merely regulatory intervention but a carefully crafted blueprint for nurturing a responsible gaming ecosystem while decisively addressing the mounting social and economic hazards of real-money gaming platforms.
India's gaming landscape presents both tremendous opportunities and significant risks. The gaming market grew 23% year-on-year to $3.8 billion in revenue in 2023-24, with the online gamer base expanding to 488 million users in 2024. Yet, beneath this growth lies a troubling underbelly: illegal betting platforms attract annual deposits estimated at $100 billion, while the top 15 illegal gambling platforms received 5.8 billion visits between April 2024 and March 2025.
A Market Worth Billions
The Indian gambling market is estimated to be worth up to $60 billion annually, with about half of these bets being illegal. This massive parallel economy operates without oversight, consumer protection, or tax contribution, causing not just loss of revenue but also active harm to millions of families across the nation.
Against this backdrop, the bill's dual approach - encouraging legitimate gaming while imposing a blanket ban on real money gaming - demonstrates sophisticated regulatory thinking. Banks and financial institutions will be prohibited from facilitating fund transfers for online money gaming, while advertisements promoting real-money gaming will be barred. From financial infrastructure to marketing practices, this multi-pronged strategy targets the entire ecosystem that enables problematic gambling behaviours.
The establishment of an Online Gaming Authority for coordinated policy support, strategic development and regulatory oversight signals the government's commitment to creating institutional capacity for long-term sector governance. This centralised approach addresses one of the key weaknesses of previous regulatory attempts - fragmented state-level interventions that created regulatory arbitrage opportunities.
A Series Of Failed Steps
India's journey toward gaming regulation has been marked by false starts and judicial setbacks. States like Tamil Nadu, Telangana, Andhra Pradesh, and Karnataka passed laws banning online games, but they were quashed by state High Courts on the grounds that an outright ban was unfair to games of skill. These piecemeal approaches failed because they lacked nuanced differentiation between harmful gambling and legitimate skill-based gaming.
The 2021 IT Rules amendments represented an earlier attempt at federal regulation but fell short of addressing the core issues. The current bill learns from these experiences by creating clear definitional boundaries and providing a comprehensive regulatory framework rather than blanket prohibitions that courts found constitutionally problematic.
The legislation focus on social protection is very pertinent as there have been witnessed suicides and deep financial losses in many situations. This stark assessment reflects the human cost of unregulated gaming platforms. The legislation's protective focus on individuals, especially youth and vulnerable populations, acknowledges that digital platforms can become vectors for social harm when inadequately regulated.
Curbing Addiction At Source
The bill's provisions will effectively curb the predatory practices that have characterised much of India's online gaming sector. By severing the financial infrastructure supporting real-money games, the legislation addresses addiction at its source - the seamless integration of gambling with digital payment systems that makes compulsive betting frictionless.
Beyond social protection, the bill addresses critical national security concerns. It tries to address risks of fraud, money laundering, and terror financing, highlighting how unregulated gaming platforms can become conduits for illicit financial flows. The anonymity and cross-border nature of many gaming platforms have created vulnerabilities that bad actors exploit for money laundering and other criminal activities.
The legislation's comprehensive approach to financial controls creates a protective firewall around India's financial system. This aligns with global best practices for preventing the gaming sector from becoming a haven for illicit financial activities.
Mindful Distinction
Real Money Gaming (RMG) continues to dominate India's online gaming sector, contributing 85.7% of the sector's revenue, valued at $3.2 billion and growing at 18% in 2024. Many think that the legislation may stifle this lucrative segment and broader economic growth in the gaming sector. However, its careful distinction between harmful real-money gaming and beneficial activities like e-sports and skill-based non-monetary online games demonstrates regulatory sophistication.
The focus on promoting e-sports aligns with global trends toward recognising competitive gaming as legitimate sports and entertainment. With India's gaming market projected to reach $9.2 billion by 2029, this approach positions India to benefit from the global e-sports boom while avoiding the social costs associated with gambling-adjacent gaming models. The legitimate gaming sector employs hundreds of thousands of developers, designers, and content creators - jobs that will be preserved and expanded under the new framework.
International Cooperation
The bill's success will depend on robust implementation and international cooperation. Many problematic gaming platforms operate from offshore jurisdictions, requiring coordinated enforcement efforts. The creation of the Online Gaming Authority provides institutional capacity for such coordination, but effectiveness will depend on adequate resourcing and technical capabilities.
The advertising restrictions will be particularly crucial, as marketing practices have been central to normalising gambling behaviours among young Indians. Effective enforcement of these provisions could significantly reduce new user acquisition by problematic platforms.
The bill, by combining protective measures with support for legitimate innovation, charts a path towards a gaming ecosystem that serves public interest while fostering economic growth. As other nations grapple with similar challenges posed by online gaming, India's comprehensive approach offers a valuable model for balancing competing realities.
The legislation's ultimate success will be measured not just by reduced gambling-related harm, but in the emergence of a vibrant, responsible gaming sector that contributes to India's digital economy while safeguarding its citizens' wellbeing.
(Subimal Bhattacharjee advises on technology policy issues and is former country head of General Dynamics)
Disclaimer: These are the personal opinions of the author
