Rewind: Game Over — Safeguard or setback for India’s gamers?

India’s new Online Gaming Act bans real-money games, raising concerns about jobs, revenue, and digital growth

By Neeraj Kumar, Maya K

In the midst of heated political debates during the Monsoon session, a significant change occurred quietly: Parliament passed the Online Gaming Bill, 2025. India’s online money gaming industry, which thrived by exploiting legal loopholes, now stares at closure. Even though a few States had imposed a ban, the lack of a unified national law allowed these platforms to continue operating across the country. The new law bans all real-money online games, redefines boundaries of what is acceptable gaming, and creates a central authority to oversee the sector.

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But as the dust settles, the big question lingers — is the move a safeguard for society or a setback for India’s gamers?

Global Gaming Boom

The global online gaming industry has grown into one of the most profitable areas of the digital economy. According to the India Gaming Report 2025, published by the Interactive Entertainment and Innovation Council (IEIC), the industry was valued at USD 324 billion in 2024. This shows how gaming has transformed from just a pastime into a global cultural and economic force. From casual mobile players to professional e-sports athletes, millions of people now engage with gaming on a global scale. The industry’s growth trajectory is striking — it is projected to grow at 7 per cent annually until 2034, nearly doubling its value to USD 590 billion.

The main drivers of this growth will be new technologies such as 5G, artificial intelligence, augmented reality (AR), virtual reality (VR), and cloud gaming. E-sports tournaments have become a popular form of entertainment, competing with traditional sports in popularity and reach. Major tournaments offer multi-million-dollar prizes and attract millions of viewers online.

India’s Share

With 883 million smartphone users, India is one of the fastest-growing gaming markets in the world, with about 591 million gamers. The country leads the global mobile gaming scene, accounting for 15.1 per cent of all downloads worldwide. In comparison, the US has 7.6 per cent and Brazil 7.3 per cent. Yet, this impressive user base has not translated into proportional revenues. Of the USD 324 billion global market in 2024, India contributed just over USD 3.7 billion, or a little over 1 per cent, while the US cornered nearly 19.3 per cent and Japan claimed 8 per cent.

This gap between user numbers and revenue shows both chances and challenges ahead. The gaming scene in India is mostly mobile-first, where 90 per cent of gamers use smartphones, compared to only 6.1 per cent on PCs, and just 3 per cent on consoles.

Despite the current challenges, the future looks promising. By 2034, India’s gaming industry is expected to grow to USD 60 billion on the back of rapid digitisation, low data costs, and a young population. Additionally, the industry is set to create over 2 million jobs in areas like game design, coding, creative arts, animation, and content creation.

Between 2019 and 2024, India’s gaming sector attracted around USD 3 billion in investment, nearly 90 per cent of which was foreign direct investment (FDI). The Real Money Gaming (RMG) segment, comprising fantasy sports, rummy, poker, and casual betting apps, was the primary magnet for these funds.

Backed by innovations like UPI-powered microtransactions, RMG became the dominant monetisation model in India, accounting for 86 per cent of total online gaming revenues. Platforms such as Dream11, MPL, Zupee, My11Circle, and PokerBaazi became household names and turned into significant taxpayers. In the financial year 2025, the sector was projected to contribute Rs 20,000 crore (USD 2.2 billion) to GST, nearly 1 per cent of India’s total GST revenue.

However, the passage of the Bill has altered this landscape. By banning online money games, the law has placed nearly 1,00,000 direct and indirect jobs at risk, while simultaneously discouraging investor confidence. For investors who were betting on India’s exponential growth in RMG, the regulatory shift has created significant uncertainty. Some of the platforms have ceased operations.

What the Law Says

The Online Gaming Act marks an important change in India’s digital policy. The law will create a central authority that can regulate, categorise, and monitor online games while also handling disputes.
It classifies games into three categories:

• E-sports: Are competitive, skill-based games recognised under the National Sports Governance Act, 2025. Players can pay entry fees and win prizes, but gambling and betting are not allowed.
• Online Social Games: Are recreational or educational games that do not involve money. Subscription models are acceptable, but wagering is not allowed.
• Online Money Games: Are completely banned. Any game involving money, whether based on skill or chance, including those using virtual tokens that can be exchanged for cash, is illegal.

Though the government argues that the law will reduce addiction, fraud, and illegal money flows by banning RMG, it threatens the part of the gaming industry that makes up 86 per cent of India’s gaming revenue. This could put jobs and foreign investment at risk and raises concerns about India’s goal to reach USD 60 billion in revenue by 2034.

China’s Model: Lessons and Warnings

Representing nearly one-fourth of global gaming revenues, China’s player base peaked at 666 million in 2021. Mobile gaming dominated this industry, accounting for 73 per cent of total revenue in 2022, followed by PCs (25 per cent) and consoles (at just 2 per cent). Major players like Tencent, NetEase, and MiHoYo not only control the domestic market but also set global benchmarks with hit titles such as Honor of Kings and Genshin Impact.

China has a robust ecosystem — developerspublishers, distributors, and technology providers create an integrated value chain. Investment from domestic tech conglomerates and venture capital has ensured China remains a hub for innovation and global gaming exports. Yet, this success story is tempered by stringent state regulation. Since 2016, all games have required licences, and approval rates remain low, stifling smaller studios.

Further, strict juvenile protection laws restrict minors to just one hour of playtime on weekends and holidays. Content is subject to censorship, with politically or culturally sensitive themes barred from release. These curbs have had significant economic consequences, reducing domestic revenues and forcing firms to look abroad.

Increasingly, Chinese gaming companies are targeting overseas markets such as Southeast Asia and Europe, while exploring emerging sectors like AR, VR, and ‘Game+’ applications in education, healthcare, and culture. For India, China’s case serves as both a warning against over-regulation and an example of how gaming can become a pillar of the digital economy.

South Korea’s E-Sports Success

If China represents a cautionary tale, South Korea symbolises the transformative potential of e-sports when supported by government, industry, and society. E-sports in South Korea are officially recognised as a sport, granting professional gamers the status of athletes. This recognition enables them to receive visas, use professional training facilities, and compete in prestigious international tournaments, including the Asian Games.

A central authority, the Game Rating and Administration Committee (GRAC), ensures compliance with rules while protecting players’ rights. Gaming events are broadcast live on television and streaming platforms, generating large-scale sponsorship deals and creating a thriving fan culture. Revenue is shared across players, developers, and organisers. Tech giants like Nexon, NCSoft, Netmarble, and Krafton continue to invest heavily in gaming innovation.

Cultural factors also play a role here. PC cafes, prevalent throughout the country, act as social hubs for gamers, integrating e-sports into everyday life. Although the mobile gaming market in Korea is smaller than that of India or the US, the average player in Korea spends significantly more money on games. This indicates a strong cultural acceptance of gaming as a legitimate activity.

India presents a starkly different picture. Despite the new legislation, gaming is still viewed as a means to earn a quick buck. Most Indian players are not trained or guided on how to build a career in e-sports, unlike in Korea, where professional coaching and training are common. Infrastructure is another problem; many areas still lack affordable high-speed internet or gaming devices, further holding back the industry.

A Health Disorder

The World Health Organisation (WHO) has recognised gaming disorder in its International Classification of Diseases (ICD-11). Symptoms include impaired control, prioritising gaming over daily activities, and persisting despite negative consequences. For diagnosis, these patterns must be evident for at least 12 months.

In India, addiction to online money games has significantly affected families. Growing concerns include financial losses, social isolation, and psychological distress. A study released in 2022 by the global consultancy firm KPMG revealed that 40 per cent of young people in the country, aged between 18 and 25, are attracted to online gambling advertisements.

The seriousness of the issue is evident. Kerala reported 20 suicides linked to online rummy between January 2019 and July 2022. In Tamil Nadu, 44 individuals died by suicide between 2019 and 2024 after losing money in online gaming. Police records in Karnataka indicate that there have been 32 suicides linked to online gambling losses since 2023, with nearly two-thirds in Bengaluru. Officers admit that the actual numbers could be much higher.

At the Crossroads

India’s online gaming industry now stands at a crossroads. On the one hand, it has the chance to grow into a USD 60 billion market by 2034, creating millions of jobs and boosting the digital economy. On the other, it faces problems like addiction, social concerns, and unclear rules.

It is here that the new Act tries to strike a balance. India can learn from China’s strict controls and South Korea’s balanced approach that treats gaming as both sport and business. With the right rules, infrastructure, and awareness, India can grow responsibly and emerge as a global leader in online gaming.

Play Pause
• Investments in India’s gaming sector between 2019 and 2024 — $3 billion
• Share of foreign direct investment in total inflows — 90% FDI
• Real money gaming’s share in revenues — 86%
• UPIMicrotransactions powered monetisation boom
• FY 2025 GST contribution projected at Rs 20,000 crore or $2.2 billion (1% of India’s GST revenue)
• Direct & indirect roles at risk — 1,00,000 jobs
• Top Platforms — Dream11, MPL, Zupee, My11Circle, PokerBaazi

Global Gaming Market, 2024 — $324 billion
• United States has 19.3%
• Japan – 8%
• China – 24%
• India – 1.1% ($3.7 billion)
• Rest of World – 47.6%

(The authors are Assistant Professors, Department of Economics, CHRIST (Deemed to Be University), Bengaluru)