A new statement by the government and three sources have revealed that the proposal to regulate only the games of skill has been overruled.
According to a government document and three sources, India’s proposed regulation of internet gambling 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.
All Real Money Games To be Regulated in India
The long-awaited laws are expected to have a significant impact on the gaming industry in India, which research company Redseer predicts would be worth $7 billion by 2026 and be dominated by real-money games.
In recent years, Indian firms Dream11 and Mobile Premier League, which are well-known for fantasy cricket, have received funding from Tiger Global and Sequoia Capital.
A new body to determine whether a game involves skill or chance was proposed by an Indian panel tasked with drafting the regulation in August. After that, skill games would be governed by federal rules that include registration requirements, know-your-customer standards, and a grievance redress mechanism.
As per reports, chance games, which are viewed as being similar to gambling, which is mostly outlawed in India, were expected to remain under the control of individual state governments, who would be allowed to regulate them.
Regulation For All Games As Distinction Is Difficult
However, a representative from Prime Minister Narendra Modi’s office opposed this disparity at a government meeting on October 26 and called for enhanced monitoring of all games, according to the private minutes of the meeting accessed by Reuters.
The official was described in the minutes as stating that it was difficult to distinguish between games that required skill and those that required chance owing to a lack of legal clarity and conflicting court rulings, and that “online gaming may be treated as one activity/service with no differentiation.”
The card game rummy and several fantasy games are skill-based and acceptable, according to the Indian Supreme Court, whereas state courts have had differing opinions on games like poker.
Commenting on this development, Mr. Roland Landers, CEO – The All India Gaming Federation, said, “As the apex industry body for online gaming, we welcome an effective and progressive central regulatory
framework. We have been engaging with the Inter-Ministerial task force, and have
submitted detailed representations for standards including consumer protection, age gating,
fair play, etc. to be adopted for all online games of skill.
AIGF under its Charter already requires its over 100 members to institute various due
diligence and consumer protection measures. However, today we have more than 900
gaming companies in India, and so, having a central framework will ensure that the industry
as a whole adopts strong consumer protection and grievance redressal measures.
In recent times, the industry has been faced with a situation where State governments have
conflated skill-based gaming with the gambling industry, and have sought to prohibit it,
causing fragmentation in the sector. This has happened despite 60 years of jurisprudence
from the Supreme Court and multiple high courts on games of skill.
We are hopeful that centralized regulation will solve this issue of state fragmentation and
unconstitutional state bans. Such clarity will improve investor confidence and further allow
the industry to grow at an even faster pace.”
Mr. Ankur Singh, CEO and Founder, Witzeal Technologies, said, “The online RMG market is currently valued at $2.2 billion it is poised to reach a value of $7 billion by FY 2026. It is important that we acknowledge the explicit distinction between games of skill and games of chance, which is needed for the governments to bring a structured growth to the entire eco-system.
This is a welcoming move for the burgeoning online skill-based real money gaming sector
and we laud the government’s efforts to regulate each paradigm of the online gaming
sector. The Indian online skill gaming sector has been under the purview of individual state
government for a long time. The Supreme Court however has acknowledged the difference
between game of skill and game of chance and has made it clear that it is supportive of
games that involve skill. We are in support of the sector being rightly regulated as it will
inadvertently push us to stay ahead of the curve. We are hopeful that the right regulation
will further aid the emerging yet promising start-ups in the industry followed with a rise in
direct and indirect employment in India.”
Regulation Necessary To Avoid Addiction, Financial Losses
Three people close to the development, including two government officials in New Delhi, have revealed that the rules will give the federal government greater control over all games while preserving the ability of state governments to outright prohibit gambling or games of chance.
The new laws were created in response to rising worries that the popularity of these games, particularly among young people, had resulted in addiction, financial losses, and even some recorded suicide instances.
According to one of the insiders in the government, the Modi administration is still worried about the possibility for addiction on such platforms.
In its August report, the government group had proposed that new regulations should include so-called “de-addiction measures” such establishing deposit and withdrawal limits as well as regular warnings and cautions.
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