From Grey Area to Governance: Decoding the Online Gaming Bill.
- Lawttorney.ai
- Aug 28
- 4 min read
Context:
On 21 August 2025, the Parliament approved the Promotion and Regulation of Online Gaming Bill, 2025, a significant step towards tackling the increasing issue of online gambling while also encouraging safe and beneficial types of digital gaming. The law seeks to mitigate addiction, financial hardship, and social damage from exploitative gaming platforms while promoting e-sports, educational games, and innovation in India’s digital economy.
The gravity of the problems is also noticed by the global community. The WHO that is The World Health Organisation, has observed gaming disorder as a health issue, explaining the important necessities for functioning. In India, the rise in internet-connected gambling has resulted in major financial issues, mental health issues and instigation of suicide. India is the 3rd of the globe, which has experienced losses from online gambling.
Grasping the Online Gaming Industry:
The online gaming sector is generally divided into three main categories:
E-sports: Competitive professional gaming that requires skill, strategic thinking, and teamwork.
Web-based Social Games: Casual skill-based games played for entertainment or social engagement, considered safe and beneficial.
Internet Cash Games: Games that involve monetary bets, relying on skill, luck, or a combination of both. These have been associated with addiction, theft, money laundering, and suicides.
Reasons for the Bill's Necessity:
Social, financial and security threats are caused by online gambling:
Reliability and Economic fall: Many humans, especially young people, lose their money by chasing fast returns.
Mental Health and Suicides: Depression and sudden suicides are caused by stress due to the financial losses.
Cheating and Money Laundering: Platforms have been created for illegal money transactions.
National Security Risks: There are few platforms which are linked with terrorism and unlawful communication.
Offshore Issues: There are many platforms which run beyond India and complicate the regulation.
While addressing the Rajya Sabha, Union IT Minister Ashwini Vaishnaw highlighted that around 45 crore Indians have been affected by online gambling, resulting in losses exceeding ₹20,000 crore, underlining the urgent need for regulatory action.
Main Elements of the Legislation:
The law is applicable throughout India and also to online gambling services provided from overseas but available in India.
Advancement of Electronic Sports:
E-sports acknowledged as a genuine sport.
Instructions to be released by the Ministry of Youth Affairs and Sports.
Creation of training institutes, research facilities, and motivational programmes.
Advancement of Social and Educational Games:
National Government authorised to identify and endorse secure social games.
Concentrate on learning, heritage, and abilities.
Platforms to encourage digital literacy and promote healthy activities.
Ban on Internet Gambling:
Total prohibition on games involving money, regardless of being skill-based, chance-based, or a combination of both.
Complete ban on advertising or endorsing such platforms.
Banks and payment systems are prohibited from handling associated transactions.
Authorities are authorised to shut down illegal platforms under the IT Act, 2000.
Creation of Online Gaming Commission:
A regulatory authority at the national level will monitor adherence.
Functions encompass game classification, complaint resolution, and the distribution of codes of conduct.
Violations and Punishments:
Running gambling games: up to 3 years in prison and a fine of ₹1 crore.
Promoting money games: maximum 2 years in prison and a ₹50 lakh penalty.
Repeat offenders: maximum of 5 years in prison and a fine of ₹2 crore.
Crimes are to be punishable and non-bailable.
Corporate Responsibility:
Businesses and their executives are accountable for violations.
Independent directors are exempt if they can demonstrate due diligence.
Authorities of Inquiry:
Officers authorised by the government can conduct searches, make seizures, and perform arrests without a warrant in specific situations.
Enquiries to track the Bharatiya Nagarik Suraksha Sanhita, 2023.
Authority to Create Regulations:
The Central Government has the authority to establish regulations for e-sports, social gaming, registration procedures, and the operations of the Authority.
Advantages of the Legislation:
Enhancement of the Creative Economy: Supports India’s emergence as a global gaming hub, generating employment, boosting exports, and advancing technology.
Youth Empowerment: Promotes safe participation in e-sports, cultivating discipline, teamwork, and professional opportunities.
Safer Online Environment: Shields households from exploitative financial schemes and misleading activities.
Global Leadership: Establishes India as a model of responsible digital governance, balancing innovation with societal protections.
Additional Significant Legal Efforts:
Information Technology Act, 2000
The IT Rules, 2021 (amended in 2023) regulate online platforms. Section 69A empowers authorities to block unlawful websites. Between 2022 and June 2025, 1,524 gambling websites and apps were prohibited.
Bharatiya Nyaya Sanhita, 2023
Section 111: Punishes illegal economic actions.
Section 112: Mandates a maximum of 7 years in prison for illegal betting/gambling.
IGST Law, 2017
Offshore gaming platforms must register under the Simplified Registration Scheme. The Directorate of GST Intelligence is empowered to restrict platforms that fail to comply.
Consumer Protection Act, 2019
Prohibits deceptive advertising. The CCPA has authority to punish violators and restrict celebrity endorsements for betting platforms.
Warnings & Cybercrime Notification
MIB advisories (2022–24): Ban deceptive internet gambling advertisements.
Cybercrime Portal (cybercrime.gov.in): Provides a dedicated channel to report online fraud.
Helpline 1930: Free hotline for reporting cyber fraud incidents.
Way Forward:
The Promotion and Regulation of Online Gaming Bill, 2025 reflects India’s commitment to a balanced and responsible digital future. The legislation strikes a proper balance between innovation and safety by banning exploitative online gambling while promoting e-sports and educational gaming. It safeguards individuals from addiction, financial loss, and exploitation, while simultaneously generating opportunities in the gaming and creative industries. Importantly, the Bill ensures that technology serves society, positioning India as a global leader in responsible digital governance.
Empower Your Legal Practice with AI – Join Our Free Webinar!
Are you a legal professional looking to boost your efficiency and stay ahead in a competitive field? Discover the power of Lawttorney.AI – the cutting-edge tool designed to streamline legal research, automate tasks, and enhance productivity.
👉 Don't miss out! Reserve your spot in our FREE webinar and experience the future of legal practice today. Register Now