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New Delhi: The government on Wednesday, August 20, moved a legislation in the Lok Sabha to ban online games played with money as it looks to check rising instances of addiction, money laundering, and financial frauds through such applications.
Union Minister Ashwini Vaishnaw introduced the Promotion and Regulation of Online Gaming Bill, 2025, amid sloganeering by MPs belonging to opposition parties in protest against alleged irregularities in electoral roll revision in Bihar.
The bill seeks to prohibit advertisements related to online money games as well as bars banks and financial institutions from facilitating or transferring funds for any of such games.
It outlaws all online betting and gambling (satta and jua) activities — from online fantasy sports to online gambling (like Poker, Rummy and other Card games) and online lotteries.
Once the legislation is passed by both Houses of Parliament, offering or facilitating online money gaming will be punishable by imprisonment of up to 3 years and/or a fine of up to Rs 1 crore.
Advertising of money games can attract imprisonment up to two years and/or a fine of up to Rs 50 lakh. Facilitating financial transactions related to money games can lead to imprisonment for up to three years and/or a fine of up to Rs 1 crore.
Repeat offences attract enhanced penalties, including 3-5 years’ imprisonment and fines up to Rs 2 crore.
At the same time, the bill calls for promotion of eSports and online social games, the source said, adding that it acknowledges that formal recognition of eSports will enable India to tune into a global competitive gaming landscape, spur innovation, create opportunities for the Indian startup ecosystem and make the country a global magnet for game development.
Citing “psychological and financial harm” that can be caused by such games, the bill says that no person “shall offer, aid, abet, induce or otherwise indulge or engage in” the offering of online money games and such services.
Online money game is one played by a user by depositing money in expectation of winning monetary and other enrichment.
Karnataka IT and Biotechnology Minister Priyank Kharge on Wednesday criticised the Centre’s decision to impose a blanket ban on online real money gaming (RMG), calling it “another masterstroke by Modi Sarkar in bad policy making.”
Kharge, son of Congress president Mallikarjun Kharge, said the decision would hit state revenues, jobs and investments.
“India earns Rs 20,000 crore annually from GST and income tax via online RMG. The ban means states lose this revenue stream,” he said in a post on ‘X’.
The minister noted that over 2,000 gaming startups and more than two lakh jobs in IT, AI and design would be at risk.
“A ban kills India’s gaming talent pool and pushes entrepreneurs abroad,” Kharge said, adding that Rs 23,000 crore of foreign direct investment in the last five years could dry up and about Rs 7,000 crore spent annually on ads, data centres, sponsorships and cyber security would vanish overnight.
Warning of unintended consequences, the minister said, “Bans don’t stop addiction or suicides. Instead, they push users to unregulated offshore platforms worth Rs 8.2 lakh crore annually where government has no control at all.
“Security risks: Unregulated sites ensure money laundering, terror financing, data theft. Even FATF and Rashtriya Raksha University warn against such risks.”
According to gaming federations, online skill gaming is a sunrise sector with over Rs 2 lakh crore enterprise valuation, over Rs 31,000 crore in revenue, over Rs 20,000 crore in annual direct and indirect taxes, and is set to grow by 20 percent CAGR to reach even greater heights and double by 2028.
The total number of Indian online gamers grew from 36 crore in 2020 to over 50 crore in 2024.
“India’s gaming industry attracted FDI of over 25,000 crores till June 2022. The industry currently supports over 2 lakh direct and indirect jobs, and these numbers will grow substantially in the next few years,” the letter further said.
They said that “a blanket prohibition would strike a death knell for this legitimate, job-creating industry, and would cause serious harm to Indian users and citizens”.
“By shutting down regulated and responsible Indian platforms, it will drive crores of players into the hands of illegal matka networks, offshore gambling websites, and fly-by-night operators who operate without any safeguards, consumer protections, or taxation,” the letter said.
The proposed ban would not only kill these opportunities but also deter global investment and investor sentiment, destroy over 2 lakh jobs, result in over 400 companies shutting down, and weaken India’s position as a digital innovator, it added.
(With inputs from agencies)
This post was last modified on August 20, 2025 4:03 pm