Ban on real-money games, heavy penalties and warrant-less searches: What India’s new gaming bill proposes

Srinagar, Aug 20: India is preparing to shutter its booming real‑money online gaming industry by advancing the Promotion and Regulation of Online Gaming Bill, 2025.

The proposed Bill enforces a blanket ban on all real money online gaming platforms in India, regardless of whether they are categorized as games of skill or chance—an issue that has long been a point of contention within the gaming industry. Under the new law, platform operators found violating the ban could face up to three years of imprisonment and fines reaching ₹1 crore.

Additionally, influencers and promoters who endorse or support these platforms may be penalized with up to two years in jail and fines of up to ₹50 lakh. Financial institutions and banks could also be prohibited from processing any transactions related to these banned platforms, further tightening the restrictions on real money gaming.

The Bill justifies this sweeping prohibition by citing various national security concerns. Authorities argue that real money gaming platforms have become conduits for money laundering and the use of cryptocurrencies in terrorist financing. There are also concerns about these platforms enabling illicit communications, potentially aiding anti-national elements. Moreover, many offshore operators are accused of bypassing Indian tax laws and other regulatory frameworks, putting domestic legal and economic systems at risk.

According to an Indian Express report the proposed ban could have a significant economic impact on India’s rapidly growing gaming sector, which is projected to reach $9 billion by 2029. Currently, the industry contributes over ₹20,000 crore in taxes and provides employment to more than 200,000 people. Leading industry bodies such as the E-Gaming Federation (EGF), the All India Gaming Federation (AIGF), and the Federation of Indian Fantasy Sports (FIFS) have criticized the Bill, warning that it may severely damage the sector and drive users toward illegal or unregulated offshore platforms. Congress MP Karti Chidambaram has also raised concerns over the legislation, stating that it appears rushed and lacks adequate stakeholder consultation. He has urged that the Bill be sent to a parliamentary select committee for a more detailed review.

Official data shows GST revenues jumped sharply after the Council’s decision in July 2023 to impose a uniform 28 per cent levy on online gaming, horse racing and casinos with effect from October 1, 2023. Union Finance Minister Nirmala Sitharam had said last September that revenue from online gaming “increased by 412 per cent and reached Rs 6,909 crore in just six months… from Rs 1,349 crore before the notification issued on online gaming”.

Despite its tough stance on real money gaming, the Bill does offer support for other segments of the industry. It formally recognizes e-sports as a competitive sporting activity, aiming to legitimize and promote this fast-growing field. Furthermore, the Bill proposes the creation of a central regulatory authority to oversee and register online social or recreational games. These would include games that operate on a subscription basis or access fees, rather than monetary stakes or betting, allowing a path for innovation and growth in the non-gambling segment of the online gaming space.

One of the most controversial elements of the Bill is its provision for warrantless searches and arrests. Enforcement agencies are also empowered to bypass digital security measures, including passwords and access controls, to carry out such operations.