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Why Gaming Bans in India Could Cause More Harm

India’s online gambling industry continues to grow and local governments are starting to look into what they should be doing about it. Here we take a look at why gaming bans in India could cause more harm.

Ankit Kanaujia
Last updated: 13.04.2023
Why Gaming Bans in India Could Cause More Harm

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India’s online gambling industry continues to grow and local governments are starting to look into what they should be doing about it. Most states in the country have not taken any significant steps regarding this matter but several states already have imposed a ban on certain online games.

Generally, online gambling in India is still in the grey area. The laws in place to regulate gambling activities in the country don’t mention anything on online betting or online casinos. The central law regulates gambling in India is the Public Gaming Act and which was passed in 1867. This doesn’t have anything on online gambling.

The modern laws concerning online activities in the country also have no mention of online betting and gambling of any form. This is why Indians can still access online gambling sites without any problems. What’s certain, however, is that local online gambling operations in the country are not allowed unless permitted by the state.

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As of today, states like Telangana and Andhra Pradesh have respectively imposed a ban on any form of online gambling. Still, Telangana has the most online punters who would go to the best ranked India betting sites .This state also accounts for over 18 percent of the online betting market in the country.


On Tamil Nadu and Karnataka

Meanwhile, the states of Tamil Nadu and Karnataka are also heading in the same direction. However, Tamil Nadu appears to be going back and forth with its online gaming regulations. Earlier this year, the state has passed a ban on online gaming with its Gaming and Police Laws Amendment but the state also has reportedly allowed Dream11 to operate without any obstructions.

This happened after the High Court has overruled the legislation that was passed earlier. Whether Tamil Nadu will be doing something about this is unclear at the moment. The state’s High Court did reaffirm that the local government could enact another law to ban particular forms of gaming.

Karnataka’s take on online gaming might also change soon. The local government has proposed to ban online gambling in the state and the reason behind it is to prevent citizens from being exposed to the risk of losing a substantial amount of money online.

The proposed amendments to the Karnataka Polic Act of 1963 include prohibiting types of online gambling activities that involve any exchange of money whether it’s in digital or another electronic form. What is exempted from this, however, is lottery and horse racing.

While the ban is not yet official, many are already questioning the consistency of the proposed bill as it is inconsistent when it comes to the distinction of games of skill and chance. This is why certain groups are calling out the Karnataka government and are requesting for them to retract the ban.

The Internet and Mobile Association of India (IAMAI) has released a statement regarding this. The group said that the bill appears to have been drafted without considering the various legal and constitutional positions as it includes a wide definition of gaming. According to them, the proposed bill would impact Indian companies negatively and offshore gambling operators would still be available to the locals.

The Confederation of All India secretary of general, Praveen Khandelwal, also wrote a letter to the Karnataka CM about this. Khandelwal said, “A game of chance is pure gambling which is addictive and should be dealt with adequate legal procedures. On the other hand, a game of skill enables players to monetize their gaming talents and finesse. Once the bill bans online skill games, law-abiding Indian companies will exit the market and the users will turn to offshore betting apps which could be harmful and dangerous.”

IAMA said that the Bill Karnataka is looking to pass could hurt the state’s position as the country’s startup hub. It could lead to the loss of jobs and revenue.



The Need for Progressive Regulations

Imposing a ban on gambling activities is not exactly progressive in terms of what it could do to India’s economy. The online gaming market size in the country is already estimated to be worth around Rs 13,600 crore this year and it is reported that the country now has over 433 million gamers.

Meanwhile, when it comes to sports betting, MyBetting reported in October that the country has over 370 million people who would place bets on major sports events like the IPL. Around 140 million of these people would bet on sports regularly.

The same report also revealed that most of the bets placed in the country are from Telangana and Karnataka. This means that even if restrictions are in place, people are still placing their bets offshore. With this, India is just losing revenues to offshore gambling companies and the underground market. It is also failing to protect its citizens from the risks that underground gambling comes with.

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