Lok Sabha Passes Online Gaming Bill
The Bill was passed by a voice vote after brief remarks by Minister of Electronics and Information Technology Ashwini Vaishnaw amid protests in the House by opposition members
A day after the Union Cabinet’s prior approval, the bill was tabled by information and technology minister Ashwini Vaishnaw in the House, prescribing legal framework and heavy punishment. The government, however, said that the move would strike a balanced path — encouraging innovation and youth engagement through safe and positive online gaming, while firmly prohibiting harmful online money games.
In his opening remarks, Vaishnaw also said the government seeks to encourage e-sports and online social gaming and will set up an authority for the purpose. “Online money gaming has become a matter of concern as such platforms have led to addiction and have also been used for fraud and cheating and it has also led to financial losses to people,” the minister said.
Citing ‘psychological and financial harm’ that can be caused by such games, the draft bill also said that no person ‘shall offer, aid, abet, induce or otherwise indulge or engage in" the offering of online money games and such services. The legislation aligns the digital domain with existing laws for corresponding activities in the physical world, wherein betting and gambling are restricted or punishable -- such as in the Bharatiya Nyaya Sanhita, 2023, as well as various state government legislations.
As per the bill, the government said that violations of law could attract stringent penalties. Once the legislation is passed by both Houses of Parliament, it said that offering online money games may result in up to three years’ imprisonment and fines of up to Rs 1 crore, while advertising them could invite two years in jail and fines up to Rs 50 lakh. “Also, facilitating transactions with such platforms could also be punishable with three years in jail and fines up to Rs 1 crore, while repeat offence could attract an enhanced penalty of 3-5 years of imprisonment and fines up to Rs 2 crore,” the government said.
The bill also has sought to bring sweeping changes to the country’s online gaming ecosystem. The bill, however, aims to regulate e-sports, educational and social gaming, while the government is firm on its decision to enforce a blanket ban on online real-money gaming, amid a rare cross-party consensus over mounting concerns about the sector’s social impact. Defending the proposed bill, the government sources said that the legislation is designed to protect users while holding companies accountable. “While the real-money gaming sector employs thousands, the “balance of convenience” lies with the crores of people adversely impacted by such games,” the sources added.
India’s gaming industry has surged in recent years, drawing over $2.78 billion in investment and hundreds of millions of users, but also raising concerns over addiction, financial harm, and debt spirals that affect lower income groups. However, an official source said that the government estimates that around 45 crore people lose close to Rs 20,000 crore every year in online real money gaming. “The government has realised that online real money gaming is a major problem for society and chose to forego revenue loss in preference to people’s welfare. Besides, multiple parliamentary committee members have also expressed frustration that prior state-level bans have failed to stem the distress these games cause in households nationwide,” the source said.
The source further said that while employment in the sector is significant, the number of Indians playing online real-money games reportedly exceeds 450 million. “There is a lot of money sloshing around, much of it targeting vulnerable and lower-income groups. As the state bans have been ineffective for a long time, the government only reinforces the need for stronger central regulation,” the source added.
As per the bill, it is expected that popular online mobile games like Real Cricket, EA Sport FC, BGMI and Free Fire, which fall under the battle royale category, may not be banned as they are considered e-sports which means which means players compete based on skill instead of gambling for cash winnings, while rampantly-used online games like Dream11, My11 Circle, MPL, Winzo, GamesKraft, 99Games and similar others are likely to face serious consequences in the upcoming law. The bill is also expected to prohibit advertisements and financial transactions related to such games, with banks and payment platforms barred from facilitating them.