Explained: The Online Gaming Bill 2025 and How It Affects Players

The Lok Sabha on Wednesday passed the Promotion and Regulation of Online Gaming Bill, 2025, which prohibits real-money gaming and online betting over concerns of addiction, financial loss, and security risks, while promoting e-sports and social games.

The legislation prohibits such platforms or their advertisements, prescribing fines, imprisonment, or both for violations, and clearly distinguishes real-money gaming from e-sports and online social play.

Union minister Ashwini Vaishnaw introduced the bill amid protests, with opposition members raising slogans and displaying placards, PTI reported.

Details of the Promotion and Regulation of Online Gaming Bill, 2025

The bill calls for the promotion of eSports and online social games, and it acknowledges that formal recognition of eSports will enable India to tune into the global competitive gaming landscape, spur innovation, create opportunities for the Indian startup ecosystem and make the country a global magnet for game development.

A source told PTI that the proposed promotion and regulation of online gaming bill, cleared by the Union Cabinet, prohibits online money gaming or its ads, and prescribes imprisonment or fine, or both, for those offering or advertising them, as it seeks to differentiate such games from eSports or online social games, according to a source.
A source added that according to the bill, anyone who provides an online money gambling service in contravention of the rules could be imprisoned for up to three years, fined up to Rs 1 crore, or both.

Additionally, those who engage in advertisements in violation of the guidelines face a maximum penalty of two years in prison, a fine of up to Rs 50 lakh, or both.  According to the source, anyone involved in any transaction or authorisation of funds faces a maximum sentence of three years in prison, a fine of up to Rs 1 crore, or both.

Congress Opposes the Bill 

Karnataka IT and Biotechnology Minister Priyank Kharge criticised the Centre's decision to impose a blanket ban on online real money gaming (RMG), calling it "another masterstroke by Modi Sarkar in bad policy making." Kharge, son of Congress president Mallikarjun Kharge, said the decision would hit state revenues, jobs and investments.

Taking to X, the Minister said, "India earns Rs 20,000 crore annually from GST and income tax via online RMG. The ban means states lose this revenue stream." The minister noted that over 2,000 gaming startups and more than two lakh jobs in IT, AI and design would be at risk.

"A ban kills India's gaming talent pool and pushes entrepreneurs abroad," Kharge said, adding that Rs 23,000 crore of foreign direct investment in the last five years could dry up, and about Rs 7,000 crore spent annually on ads, data centres, sponsorships, and cyber security would vanish overnight.

Warning of unintended consequences, the minister said, "Bans don't stop addiction or suicides. Instead, they push users to unregulated offshore platforms worth Rs 8.2 lakh crore annually, where the government has no control at all.

Congress leader Shashi Tharoor also criticised the bill and warned that such a step would only push the industry underground and strengthen criminal networks.

He said, "I had written a very long article on the argument that by banning online gaming we are simply driving it underground, whereas it could be a useful source of revenue for the government if we legalise it, regulate it and tax it." He added that many countries have studied the issue in detail and concluded that regulation and taxation can generate funds for social causes, while bans merely enrich “criminal mafias”.

In a post on X, Tharoor recalled that he had “gone on record in 2018, urging the government to legalise, regulate and tax online gaming, rather than drive it underground by banning it, which will merely enhance the profits of the mafia”.

“It’s a pity that the government seems to have derived no lessons from the experience of other countries that have considered this issue,” he wrote.

He added that the bill should at least have been referred to a parliamentary committee “to consider all the pros and cons before rushing it into law”.

Gaming Bodies Seek Intervention Against Bill

In a letter to Union Home Minister Amit Shah, industry associations for India's online skill-gaming market have asked for his "urgent intervention" against a rumoured draft bill that would outlaw all real-money games, including skill-based ones.

The federations said in a joint letter that a complete ban would be a "death knell" for the sector, destroying jobs and driving crores of users to illicit offshore gambling and betting sites.

On behalf of the Federation of Indian Fantasy Sports (FIFS), the E-Gaming Federation (EGF), and the All India Gaming Federation (AIGF), the letter was sent on August 19.

According to the letter, the online skill gaming market is a "sunrise sector" with yearly sales reaching Rs 31,000 crore and an enterprise worth above Rs 2 lakh crore.  Its yearly direct and indirect tax contributions exceed Rs 20,000 crore, and it is anticipated to double by 2028 at a compound annual growth rate (CAGR) of 20 per cent.

PTI reported that according to the report, the number of Indian online gamers increased from 36 crore in 2020 to over 50 crore in 2024. It also stated that the industry supported over two lakh direct and indirect jobs at the time and had drawn over Rs 25,000 crore in foreign direct investment (FDI) up till June 2022.

The letter stated, “Our sector represents not just entertainment, but the creation of an indigenous, future-ready industry at the intersection of emerging technology, creativity, and entrepreneurship. Today, thousands of startups, young engineers, and content creators rely on this ecosystem.”

Adding further, “The only beneficiary of this bill will be the illegal offshore gambling operators. If legitimate Indian businesses are shut down, unregulated actors will fill the vacuum. This will erode state and national tax revenues while leaving Indian users exposed to unregulated platforms.”

The organisations advocated for "progressive regulation and not prohibition," and asked the minister to meet with them so they could make their case and talk about ways to protect the sector and users while ensuring responsible gambling.

Anuraag Saxena, the CEO of EGF; Roland Landers, the CEO of AIGF; and Joy Bhattacharjya, the Director General of FIFS, all signed the letter.