India's prohibition on online gambling poses a potential threat to the survival of the fantasy gaming industry.
The Indian parliament has passed a law banning online games that involve real money betting, marking a significant shift in the country's digital landscape. The new legislation, which is part of a strategy for digital security and ethical technology regulation, aims to combat gambling addiction and a perceived "social evil" in India.
Under the new law, online games with real money transactions are prohibited. This includes popular platforms like Dream11 ($8 billion), Mobile Premier League ($2.3 billion), and Games24x7, which have collectively invested millions of dollars in their platforms. The law also extends to games that may cause psychological or financial harm to users, and those where earnings are primarily from active game promotion.
However, the law's implementation has sparked controversy. Companies are preparing appeals to the Supreme Court, stating that the new law has several negative aspects. Critics argue that it violates constitutional rights to entrepreneurial activity and freedom of expression. Lawyers have also pointed out the lack of clear criteria for defining "harmful" games, which could create risks for selective law enforcement.
Major players in the sector have announced the likelihood of mass layoffs, closure of certain services, and a review of business strategies. Analysts predicted the market size of the fantasy sports industry would reach $3.6 billion by 2029, but these projections are now uncertain.
The law does not differentiate between gambling and skill-based games such as poker or fantasy sports. This could significantly affect the fantasy sports industry in India, worth a combined $8 billion. The new law was adopted without conducting necessary consultations with the industry, adding to the controversy.
The Minister for Electronics and Information Technology in India, Shri Ashwini Vaishnaw, is involved in initiatives related to information technology, including the semiconductor mission. However, there is no direct mention in the search results that he is specifically advocating for a bill to ban online betting games.
The law also prohibits the promotion of such games in mass media, social networks, or mobile applications. Violating the law can result in imprisonment of up to three years or a fine of up to 1 crore rupees (around $120,000). The law is intended to protect societies, particularly youth, from the harmful effects of uncontrolled online gambling growth.
