Regulating Online Gaming in India

Following the decision by the Ministry of Electronics and Information Technology (MeitY) to abandon the proposal for a self-regulatory organization for online gaming, there appears to be a consideration for the establishment of an independent regulatory body. According to The Economic Times, this body would potentially restrict e-gaming services in India to registered entities only.

The National Law University (NLU) Delhi, in collaboration with the E-Gaming Federation (EGF), is engaging with various industry stakeholders to gather insights on the future direction of gaming regulations. Those familiar with the matter indicate that discussions are ongoing.

In the past, the government had put forth a proposal to establish multiple self-regulatory bodies (SRBs) for gaming as part of the proposed IT Rules 2023. These SRBs were intended to be vested with the authority to determine the eligibility of gaming companies operating in India, distinguishing between permissible and non-permissible entities.

The online gaming sector in India stands out due to its proactive stance in urging government regulation, particularly to clarify the distinction between permissible gaming and gambling.

Affected by various challenges including incidents of money laundering, high taxation rates, and disruptions to business economics, real-money gaming companies like Dream11, Mobile Premier League, Deltatech Gaming, Nazara, Games24x7, among others, are advocating for regulatory frameworks to delineate legitimate activities from illicit ones.

The e-gaming industry in India presently represents a $3-billion market, with 80% of this revenue generated from real-money platforms. According to a recent report by gaming company Winzo Games, India has outpaced the US and Brazil to emerge as the world's largest gaming market. The country boasts a user base of 568 million gamers and witnessed over 9.5 billion gaming app downloads in 2023.