According to a government document and three sources, India’s proposed regulation of online gaming would cover all real-money games after the prime minister’s office rejected a proposal to merely regulate games of skill and exclude games of chance.
Redseer, a research firm, claimed that India’s gaming industry would be worth $7 billion by 2026 and will be dominated by real-money games. The eagerly anticipated laws are seen as determining the future of the industry.
Tiger Global and Sequoia Capital recently backed the Indian firms Dream11 and Mobile Premier League, which are well-known for their fantasy cricket competitions.
In August, an Indian panel charged with drafting the regulation proposed creating a new body to determine whether a game involves skill or chance. Subsequently, skill games would be governed by federal rules that include registration requirements, know-your-customer standards, and a grievance redress mechanism.
Games of chance, which are compared to gambling and are generally prohibited in India, were planned to remain under the control of individual state governments, who would be free to regulate them.
However, a representative from Prime Minister Narendra Modi’s office opposed this in a government meeting on October 26 and called for expanded monitoring of all games, as per Reuters.
According to the official, due to a lack of legal clarity and conflicting court rulings, determining whether a game is one of skill or chance wasn’t always easy. “Online gaming may be considered as one activity/service with no distinction,” he added.
Differentiating between games has always been a bit of a stretch in India. Rummy and a few other fantasy games are skill-based and permissible, according to the Supreme Court, whereas state courts have had different opinions on games like poker.
According to Reuters, three individuals with direct knowledge of the rule-making procedure, including two New Delhi-based government representatives, told them that the rules will give the central government greater control over all game types while retaining state governments’ authority to outright prohibit gambling or games of chance.
A rising number of people are worried that the popularity of these games, particularly among young people, has resulted in addiction, financial losses, sometimes leading to suicides. This has led to the creation of the new regulations.
According to one of the sources in the government, the Modi administration is still worried about the possibility of addiction to such platforms. In its August report, the government group had proposed that new regulations should include measures to prevent addiction to these games.