In a groundbreaking move to regulate India’s booming digital gaming industry, the Union Cabinet, chaired by Prime Minister Narendra Modi, approved the Online Gaming Bill on August 19, 2025, making online betting a punishable offense. The legislation, set to be introduced in the Lok Sabha on August 20, 2025, aims to curb illegal betting, address addiction, and tackle financial fraud linked to unregulated gaming platforms. This bold step signals the government’s commitment to fostering a safer and more transparent online gaming ecosystem while cracking down on exploitative practices.

A Robust Framework to Regulate Online Gaming

The Online Gaming Bill introduces a comprehensive legal framework to oversee India’s rapidly growing online gaming sector, projected to reach $9.1 billion by 2029, with real-money games accounting for nearly 86% of revenues. The legislation designates the Ministry of Electronics and Information Technology (MeitY) as the central regulator, empowering authorities to block unregistered or illegal platforms and impose strict penalties, including up to seven years in prison and hefty fines for violations. A key provision bans all money-based gaming transactions, prohibiting banks and financial institutions from processing funds for real-money online games.

The bill also targets misleading endorsements, holding celebrities and influencers accountable for promoting unauthorized betting apps. This measure aims to curb the glamorization of gambling, which often lures vulnerable audiences, particularly youth. Additionally, the legislation promotes e-sports and non-monetary skill-based games while prohibiting advertisements for real-money gaming, ensuring a clear distinction between entertainment and gambling.

Addressing Addiction and Fraud

The government’s crackdown comes amid rising concerns about addiction, financial fraud, and the social impact of unregulated betting apps. Since 2022, over 1,400 illegal betting and gambling platforms have been blocked, with 1,524 blocking orders issued by June 2025. The bill addresses these issues by introducing measures to combat addictive behavior, fraudulent practices, and inconsistent state regulations. The Education Ministry has issued advisories to parents and teachers, while the Information and Broadcasting Ministry has mandated disclaimers on gaming ads to highlight financial risks and addiction potential.

The legislation builds on existing measures, including a 28% GST on online gaming revenue since October 2023 and a 30% tax on winnings starting in the 2024–25 fiscal year. New criminal provisions under the Bharatiya Nyaya Sanhita, effective since December 2023, already make unauthorized betting punishable by up to seven years in jail. However, as “betting and gambling” fall under the State List of the Constitution, states retain primary authority to act against illegal activities, creating a complex regulatory landscape that the bill seeks to harmonize.

Mixed Reactions and Industry Impact

The bill has sparked varied reactions. Supporters, including posts on X, hail it as a “surgical strike” on illegal betting, praising its focus on consumer safety and accountability for endorsers. Others, however, view it as a potential overreach, with some X users suggesting it could drive the gaming industry underground or increase political lobbying. The bill’s emphasis on banning real-money transactions may impact platforms offering games of skill like rummy and poker, which courts in Gujarat, Madras, and Punjab & Haryana have previously deemed legal due to their skill-based nature.

India’s online gaming market, with 425 million gamers as of 2023, has grown at a 28% CAGR between 2020 and 2023, attracting significant foreign investment. However, the sector has faced challenges due to high taxation and regulatory ambiguity. The bill’s stringent measures could deter illegal operators but may also affect legitimate platforms, prompting industry leaders to call for clearer guidelines on the distinction between games of skill and chance.

A Step Toward Responsible Gaming

The Online Gaming Bill marks a pivotal moment for India’s digital landscape, aiming to balance innovation with public welfare. By criminalizing online betting and regulating real-money gaming, the government seeks to protect users from financial harm and addiction while fostering a safer environment for e-sports and skill-based games. The legislation’s success will depend on its implementation and the ability to address state-level inconsistencies, but it undeniably sets a strong precedent for responsible gaming in India.

Disclaimer: Information is based on recent reports and may evolve as the bill progresses through Parliament. Stay updated with credible news sources for the latest developments.