On August 20, 2025, the Union Government introduced the Promotion and Regulation of Online Gaming Bill, 2025, in the Lok Sabha, tabled by IT Minister Ashwini Vaishnaw, and it was passed by the Lok Sabha last night.
A key highlight of the Bill is its formal recognition of esports as a competitive sport. For the first time, esports was placed in the same league as other legitimate sporting disciplines, with provisions for official guidelines, training institutions, and government-backed incentives. The push extends to educational and social gaming, supported by ministries including Youth Affairs & Sports, Electronics & IT (MeitY), and Information & Broadcasting, in an effort to align India’s gaming landscape with global standards.
In sharp contrast, the Bill imposes a blanket ban on online money games, defined as any digital game where users pay fees, deposits, or stakes with the expectation of winning monetary or material rewards. Such offerings, including their facilitation, advertisement, and participation, are now prohibited. This prohibition marks a decisive break from the past decade, when online money games occupied a grey zone of state-level regulation and often blurred the lines between skill and chance.
Laying the Bill before the House, Communications and IT Minister Ashwini Vaishnaw noted that India’s digital and online ecosystem had grown exponentially, giving rise to varied forms of gaming. He differentiated between casual games and esports, which he described as educational and entertaining, and money-based online games, which he said were harming families and creating risks due to their opaque nature. According to Vaishnaw, such platforms posed multiple hazards, including threats to national security through avenues like money laundering and terror funding.
He emphasised that the government intends to support the growth of esports and casual gaming while protecting society from the adverse effects of money-based games. “This Bill protects society, and I request the House to pass it unanimously,” he said.
Speaking after the Lok Sabha passed the ‘Promotion and Regulation of Online Gaming Bill, 2025’, the minister said that many middle-class families have lost their life’s savings to such platforms, with tragic consequences.
The government has also attached teeth to enforcement. According to Reuters, violators will face penalties of up to three years in jail and heavy fines. This signals a hardline stance against what policymakers describe as the “addictive and manipulative” design of money-based platforms that expose young players to financial and mental health risks.
The legislation takes a strict stand against money-based online games. It will prohibit advertisements across television, print, and digital platforms, including endorsements by celebrities and influencers. Violations will lead to imprisonment of up to two years, fines of up to ₹50 lakh, or both. Repeat offences will attract harsher penalties, up to three years in jail and fines of up to ₹1 crore.
The Bill outlines the establishment of a central regulatory authority that will provide policy support, oversee compliance, and promote innovation in the sector. According to the financial memorandum, the authority will require an initial capital expenditure of around ₹50 crore, followed by an annual recurring cost of ₹20 crore from the Consolidated Fund of India.
The Bill carries the weight of Cabinet approval, which came just a day earlier on August 19, 2025. This endorsement underscores the government’s approach of promoting esports and legitimate gaming culture, while also cracking down on predatory real-money gaming platforms that have drawn repeated scrutiny for addiction, debt traps, and fraud.
The decision has sent shockwaves through the real-money gaming sector. Industry watchers warn that the sweeping prohibition could dismantle India’s domestic RMG ecosystem, driving users toward unregulated offshore operators instead.
The market reflected this unease: shares of listed gaming companies such as Nazara Technologies and Delta Corp dropped by as much as 7% in the immediate aftermath of the Cabinet’s nod, underscoring investor anxiety about the industry’s uncertain future.
Through this Bill, the government envisions a reset, steering India’s digital gaming industry toward a cleaner, safer, and growth-oriented path. By legitimising esports while shutting the door on real-money platforms, the state hopes to balance innovation with consumer protection, paving the way for a new era of structured, globally competitive gaming in India.
While the government says the Bill aims to curb digital fraud by prohibiting fund transfers and celebrity endorsements, the gaming industry warns it could cripple 400 companies, put 2 lakh jobs at risk, jeopardises ₹25,000 crore in investment, $3 billion in FDI, and impacts ₹20,000 crore in GST contributions.
With the Bill now passed, the esports and gaming industry is weighing in on what the Bill could mean in practice. Folks from across the ecosystem, spanning tournament organisers, team owners, and creators, see this as both a moment of opportunity and a call for clarity.
Akshat Rathee, Co-founder and Managing Director of NODWIN Gaming, pointed out that recognition is only the first step.
He said, “The government’s intent to recognise and promote esports, as highlighted in the recent bill, is an encouraging step towards building a structured and globally competitive ecosystem. However, for this vision to truly materialise, it is critical that the terminology used in the bill, particularly the distinctions between esports, online gaming, online social gaming, and online money gaming be clearly defined and uniformly understood. The absence of precise definitions has often led to ambiguity and conflation around the term “esports”. Such overlaps can create confusion not just for regulators, but also for players, teams, investors, and organisers who are working hard to build this industry.
Clear and consistent definitions will create a strong regulatory foundation that ensures investor confidence, long-term stability, and sustainable growth. It will allow every stakeholder from athletes and teams to platforms and video game publishers to operate with clarity and confidence, knowing the industry’s guardrails are well established. This alignment between government intent and regulatory clarity will ensure that India doesn’t just participate in the global esports movement, but establishes itself as one of its leading powerhouses.”
Furthermore, Animesh “Thug” Agarwal, Co-founder and CEO of S8UL, views the Bill as a watershed moment that has finally drawn a protective line between esports and gambling.
He said, “This bill marks a historic turning point for Indian esports. By drawing a clear line between skill-based competitive gaming and betting, it safeguards the integrity of our ecosystem while opening doors for structured growth. Esports is a sport- built on skill, discipline and years of grind. With government recognition and the right infrastructure, India is now poised to become a global powerhouse in esports and gaming culture.
The focus must now be on developing infrastructure such as arenas, bootcamps, education programs, and scholarships to nurture the next generation of talent, whether competing on the world stage or shaping culture as gaming creators.”
Rohit N Jagasia, Co-founder and CEO of Revenant Esports, sees the Bill as a long-awaited remedy to years of policy inconsistency across states.
He said, “The Promotion and Regulation of Online Gaming Bill, 2025 is a welcome step toward resolving years of uncertainty in the sector. At present, a mix of state-level restrictions creates inconsistency. This bill helps bring a balance to that. With a central framework in place, we can unlock investment, foster innovation, and drive global competitiveness. The bill also recognises the crucial difference between esports, social gaming, and chance-driven money games. For esports in particular, that clarity is essential for growth and credibility. Once the detailed provisions are made public, we’ll have a clearer sense of its implications for esports. But it could well mark the start of India’s rise as an international esports leader.”
Vishal Parekh, Chief Operating Officer, CyberPowerPC India, praised the Bill as a landmark step for Indian esports.
He said, “The Online Gaming Bill 2025 is a landmark step for the Indian gaming industry. It officially recognizes esports as a distinct category and gives it a separate identity as a pure form of sport. For years, it was wrongly perceived as being tied to betting, gambling, and money matters. Esports has always been about skill, teamwork, and discipline, not luck. This move encourages players to speak more freely about esports, showcase their talent, and engage more confidently with sponsors, organizations, and most importantly their families, especially parents who have often misunderstood it. With esports now finding a place in multi-sport events like the Asian Games 2026, including PC gaming, the momentum is only going to grow. This is a huge boost for everyone in the industry to look forward to its development in India.
I am also glad to see our honourable Prime Minister Modiji taking the effort to understand the challenges and opportunities within the esports ecosystem. His engagement with young gamers, esports athletes, and creators shows a recognition of how big this industry can become. Beyond winning tournaments, this is about building an entire industry that can positively impact India’s economy and position the country as a global force in gaming and esports.”
Naman Mathur aka Mortal, gaming content creator, highlighted the importance of separating esports from money-based gaming.
He said, “What stands out in this bill is the clear separation of esports from real money gaming. For creators, that distinction is critical because it removes a major misconception about gaming in India. It tells parents and audiences that what we do is about skill and competition, not chance. That recognition makes it easier for new talent to come forward without stigma and for creators like us to build responsibly in this space.”
Harsh Paudwal aka SOUL Goblin, BGMI athlete playing for Team iQOO Soul, reflected on opportunities for players.
He said, “As players, we’ve always known the grind behind esports, long hours of practice, teamwork, and constant learning. With the government investing in training and structured events, the upcoming generation of athletes will have a much clearer pathway to pursue esports professionally. It’s the kind of support that can really take Indian players to the global stage.”
Abhay Raj Mishra, President & National Convenor, PRAHAR, encouraged a more cautious approach.
He said, “Government needs to reconsider and take a more calibrated stance, as prohibition has never worked. This bill will bring back the satta market with a vengeance. Blanket bans tend to drive users to unregulated platforms rather than protecting them. Instead of reducing harm, prohibitions create black markets that are harder to regulate and far riskier for users. PRAHAR’s survey of 2,500 gamers in Telangana in July this year proves this: despite an eight-year ban, players in Telangana still use VPNs, side-loaded apps, Telegram groups and payment workarounds, and more than 94% say they want regulated, legal options.
The second big concern is that this bill is anti–Indian entrepreneurship. It unilaterally promotes foreign gaming companies. The esports and casual gaming sectors that the bill promotes are dominated by international giants, largely Chinese and US gaming companies. This is a U-turn, as at one point in time India had banned PUBG. Now the same players will have parliamentary legitimacy to operate freely in India, with potential compromise of the sovereignty and integrity of the nation. Since India has so far only produced successful companies in the ‘skill-based money games’ space, a more balanced approach is advisable.”
Ananay Jain, Partner, Grant Thornton Bharat shared that the Bill sets the stage for a transformative phase in India’s digital gaming landscape.
He said, “India is entering a transformative era in digital gaming with the Promotion and Regulation of Online Gaming Bill, 2025. Moving beyond fragmented state regulations and outdated gambling and IT provisions, the Bill establishes a comprehensive national framework designed to balance regulatory oversight with the growth potential of the gaming industry.
The legislation formally recognizes e-sports, social, and educational games as legitimate avenues for skill development, entertainment, and economic expansion. By clearly defining permissible gaming categories, it resolves the ambiguity that previously left legal skill-based games in a grey zone. This clarity encourages domestic and international investment, facilitates professional tournaments, streaming platforms, and educational initiatives, and unlocks new revenue streams and employment opportunities.
At the same time, the Bill takes a decisive stance against online money games, which involve real-money stakes and pose risks of addiction, fraud, and social harm. By setting clear boundaries and imposing strict penalties on operators, advertisers, and financial intermediaries associated with prohibited games, it enforces accountability and safeguards users.
From an industry perspective, the Bill is a double-edged sword. On the positive side, it legitimizes e-sports and skill-based games, enabling professional growth, content creation, and educational initiatives, while providing a clear regulatory environment that reduces legal uncertainty and fosters innovation.
However, there are challenges and potential negative impacts. The blanket restrictions on certain real-money games may stifle segments of the gaming market that were previously generating significant revenue, particularly in mobile gaming and tournament-based platforms. Smaller start-ups and emerging developers may face compliance burdens and financial strain due to penalties and regulatory requirements. Additionally, the Bill could slow the pace of certain innovations in skill-based monetized platforms, as companies navigate a complex legal landscape.
Compared with earlier frameworks—state-specific gaming laws and limited IT Act provisions—the 2025 Bill is broader, more structured, and forward-looking. Previous laws focused mainly on curbing illegal gambling, leaving legal gaming in a grey area. The new framework balances innovation, accountability, and player protection, giving the industry room to grow while mitigating social risks.
Looking ahead, the Bill positions India to emerge as a global hub for responsible digital gaming. Its long-term success will depend on effective enforcement, collaboration with stakeholders, and adaptive updates to match emerging technologies, including VR/AR gaming, metaverse applications, and international e-sports.
In conclusion, the Promotion and Regulation of Online Gaming Bill, 2025 is a strategic, forward-looking framework that creates a safer, more transparent ecosystem. While it offers significant opportunities for innovation, skill development, and economic growth, it also presents challenges for certain segments of the industry. Balancing regulation with entrepreneurial flexibility will be key to transforming India’s gaming landscape into a sustainable, competitive, and globally recognized hub.”
In many ways, the Promotion and Regulation of Online Gaming Bill, 2025 marks a turning point, setting boundaries that aim to protect users while giving esports a legitimate place in India’s sporting and cultural landscape. Yet, as industry voices underline, the road ahead will be shaped not just by the intent of the law but by its interpretation and execution.
If implemented with nuance, the Bill could accelerate India’s rise as a global esports hub. If not, it risks stifling innovation and driving players toward murkier waters. For now, the country’s gaming community finds itself at a crossroads, hopeful, cautious, and watching closely as this new chapter begins.
