India’s decision to ban all forms of real-money online gaming has set off one of the biggest debates the industry has seen in years. The law, passed in August 2025, was introduced as a safeguard against addiction, fraud, and underage gambling, with officials behind the move describe it as a way to wipe out social problems tied to betting. Yet critics say the India iGaming ban may do more harm than good, with one fear dominating the conversation: the black market.
How the Ban Came Together
The new law, known as the Promotion and Regulation of Online Gaming Act, 2025, was rushed through the system. The lower house gave its approval on August 20, the upper house followed the next day, and the president signed it on August 22. With that, India went from being one of the largest emerging gaming markets in Asia to a country where real-money games online are outlawed, regardless of whether they’re skill-based or chance-based.
The penalties are stiff. Operators face fines, loss of licenses, and even criminal liability if they continue offering real-money products. For players, the law effectively closes off any legal avenues for participation.
Why Critics Are Pushing Back
Opponents of the ban don’t argue that regulation is unnecessary. Most agree safeguards are needed. What troubles them is the sweeping nature of the law.
Gaming law specialists point out that countries with strong regulatory systems, such as the UK, have managed to balance consumer protection with industry growth. By contrast, a total ban leaves players without safe alternatives. As one legal analysis put it, prohibition doesn’t eliminate demand, it simply diverts it to less transparent places.
Industry groups, including the All India Gaming Federation, have been outspoken in warning about lost jobs and shuttered businesses. India had built a sizable gaming economy over the past decade, with developers, customer support teams, and entire ecosystems tied to online play. Many now face an uncertain future.
Economic Shockwaves
The market reaction was immediate. Dream11, one of the country’s most successful fantasy sports platforms, reported that 95% of its revenue disappeared virtually overnight. MPL, another major operator, has already started restructuring and announced plans to let go of roughly 60% of its Indian staff, close to 300 people. Both companies are now pivoting to free-to-play models and international expansion just to survive.
This sudden disruption highlights what critics call the hidden cost of prohibition. Not only are companies struggling, but the government itself stands to lose billions of rupees in tax revenue.
Black Market Concerns
Perhaps the biggest fear is that players won’t simply stop gaming. They may look for alternatives on unregulated sites, many of which operate offshore or through encrypted channels. These platforms are harder to monitor, more vulnerable to fraud, and almost impossible to tax.
In practice, that could mean players face greater risks while the state loses oversight and revenue. It’s exactly the opposite of what policymakers say they want to achieve.
Karnataka’s Different Path
Some regions are exploring a middle ground. Karnataka has floated the idea of a regulatory authority that would separate games of chance from games of skill, license the latter, and impose penalties on illegal operators. The proposal also includes support for individuals struggling with gambling problems.
This approach has been welcomed by analysts as more pragmatic. Instead of pushing activity underground, it acknowledges that demand exists and tries to channel it into safer, regulated spaces.
What Comes Next
India’s ban is still new, and its long-term effects will take time to measure. What’s already certain is that the law has changed the landscape overnight. Investors are nervous, operators are shifting strategies, and players are left with fewer legal choices.
For now, the focus will be on whether the black market fills the gap left by regulated operators. If it does, lawmakers may find themselves revisiting the policy sooner rather than later.
Closing Thoughts
The debate around India’s gaming ban is far from over. Supporters see it as a bold step to protect citizens. Critics see it as a miscalculation that puts jobs and consumers at risk. Both sides agree on one point: online gaming isn’t going away.
The real test will be whether India chooses to maintain a hard line or eventually pivots toward regulation that balances economic opportunity with social responsibility. Other countries in the region will be watching closely, and the lessons learned here could shape gaming policy well beyond India’s borders.
