Key Concerns
- Rise of Illegal Offshore Gambling
- Offshore gambling sites and apps are growing rapidly in India.
- These platforms avoid regulations and taxes, undercutting legal RMG firms.
- They operate using “mule” bank accounts and domain-switching tactics, making enforcement difficult.
- High Tax Burden on Legal RMG Firms
- Legal RMG firms, including Dream11 and PokerBaazi, are subject to 28% GST.
- Industry argument: Lowering taxes could make legal gaming more competitive and reduce illegal market growth.
- Government stance: No policy change despite concerns over lost tax revenue.
Market Impact
- Illegal Market Growth
- Offshore gambling firms are growing at a 30% CAGR, mirroring early growth patterns of legal RMG before GST imposition.
- Legal RMG firms now see a slower growth rate of 10%-15%.
- A 2024 industry report estimates the illegal betting market size at ₹8.2 lakh crore and expanding.
- Crackdowns & Challenges
- Authorities have taken action against some platforms, e.g., Mahadev app.
- Foreign-based firms like 1xBet are harder to curb due to their shifting banking providers and domains.
Industry Developments
- Consolidation in the RMG Sector
- Head Digital Works acquired Adda52 for ₹491 crore.
- Nazara Technologies (RMG + video games) bought a major stake in PokerBaazi (Moonshine Technology).
- OneVerse acquired PokerDangal.
- Regulatory Uncertainty
- The IT Amendment Rules, 2023, which propose self-regulation, remain on hold.
- The government has not yet recognized any self-regulatory body.
- In response, the industry has:
- Supported studies on playtime limits.
- Established a code of ethics to reinforce responsible gaming.
India’s legal RMG industry faces high taxes, slow growth, and unfair competition from unregulated offshore platforms. While industry consolidation continues, regulatory uncertainty and ineffective enforcement create challenges for both businesses and policymakers.
