Online Gaming in India
Why it Matters?
The government is considering raising GST on online gaming to 40%, categorising it with “sin goods” like tobacco and luxury cars. Revenues from the current 28% levy surged 412%, touching ₹6,909 crore in six months. With Indians spending over ₹10,000 crore monthly, policymakers seek tighter regulation including AML and KYC norms.
What You Should Know?
Online gaming refers to games played over the internet using computers or mobile devices.
It includes casual games, fantasy sports, real-money gaming (RMG), esports, and multiplayer role-play games.
India has over 590 million gamers, making it one of the world’s largest gaming markets.
About 155 million Indians engaged in real-money gaming in 2024 (fantasy sports, rummy, poker).
Daily active users in real-money gaming are ~110 million.
Online gaming in India operates under a fragmented legal framework – no single central law governs it.
Prize Competitions Act, 1955 regulates prize based competitions.
Public Gambling Act, 1867 (PGA) exempts skill-based games from penalties.
“Betting and gambling” is a state subject under entry 34 of the List II (State List) of the Seventh Schedule of the Indian Constitution and state legislations define betting and gambling related offences.
The legal distinction is between “games of skill” (legal) and “games of chance” (illegal gambling).
The Supreme Court of India has upheld that games involving substantial skill (e.g., rummy, fantasy sports, horse racing) are legal.
India's FDI policy prohibits foreign investment and technology collaboration in lotteries, gambling, and betting, including licensing and brand agreements.