India’s $23B Online Gambling Ban

India has implemented a nationwide ban on online real-money gaming through the Promotion and Regulation of Online Gaming Bill, 2025. The law prohibits all online games involving monetary stakes, regardless of whether they are based on skill, chance, or a combination of both.

India’s $23B Online Gambling Ban

According to a detailed report by Konvoy, government officials justified the move by citing four primary concerns: the rise in suicides linked to gambling losses, algorithmic targeting of vulnerable individuals, risks of money laundering and terror financing, and broader social protection goals. IT Minister Ashwini Vaishnaw described online gambling as a “big evil creeping into society,” a phrase that reflects the moral framing of the policy. The rhetoric recalls the language of America’s Prohibition era in the 1920s, when alcohol was outlawed under similar claims of protecting society.

India’s $23B Online Gambling Ban

Suicide Prevention and the Question of Causation

The central argument in support of the ban has been suicide prevention. India recorded 171,000 suicides in 2022, representing a rate of 12.4 per 100,000 population, the highest ever reported for the country. This figure marks a 4.2 percent increase over 2021 and a 27 percent rise since 2018. India now accounts for over one-third of global suicide deaths among women and nearly one-quarter among men.

While these statistics are alarming, the data specifically linking suicides to online gambling is limited. Tamil Nadu recorded 47 gambling-related suicides between 2019 and 2024, while Karnataka reported 32 cases over a period of just over two years. Although each case is significant, the numbers represent only a small fraction of India’s wider suicide crisis, suggesting that the connection between online real-money gaming and overall suicide rates is less direct than policymakers imply.

International comparisons further complicate the argument. India’s suicide rate of 12.4 per 100,000 remains lower than countries such as South Korea, Lithuania, and Russia, where gambling is legal and suicide rates are considerably higher. This raises questions about whether gambling is a primary driver of India’s suicide problem or whether other social, cultural, and economic pressures play a greater role.

India’s $23B Online Gambling Ban

The Selective Focus on Online Gaming

The government’s decision to focus on online real-money gaming while leaving other digital platforms largely unregulated has also drawn scrutiny. Research has shown stronger associations between heavy social media use and suicide risks than between online gambling and mental health crises. Studies have consistently linked excessive time on social networking platforms to increased psychological distress, poor self-rated mental health, and higher rates of self-harm among young people.

Despite these findings, social media companies continue to operate in India without significant restrictions and generate substantial advertising revenue. This discrepancy has prompted questions about why online gambling was singled out for prohibition while other digital industries with clearer connections to youth mental health remain untouched.

India’s $23B Online Gambling Ban

Gambling in Indian History

Gambling has been part of Indian society for thousands of years. Archaeological discoveries of dice in Western Punjab and references in classical texts indicate that wagering was both culturally significant and widely practiced. The ancient Arthashastra even recommended state-run gambling centers, with the government collecting revenue while exercising oversight.

During the colonial period, restrictions became stricter, but independent India generally adopted a pragmatic approach, allowing activities such as horse racing to operate under regulation. The current nationwide ban therefore represents a departure from India’s historical regulatory philosophy, favoring moral judgment and prohibition over state-managed oversight.

Cultural factors add another dimension to the issue. Indian society places a strong emphasis on family honor and financial responsibility. Losses from gambling can therefore carry heavier social consequences, potentially increasing the risk of severe outcomes such as suicide. Critics argue, however, that this cultural sensitivity is better addressed through regulatory safeguards rather than absolute prohibition.

The Economic Impact of Prohibition

The economic fallout of the ban has been severe. India’s online real-money gaming industry was valued at $3.8 billion in 2024, with projections suggesting it could reach $9 billion by 2029. The sector attracted over $2 billion in international investment and supported approximately 200,000 jobs, many in advanced fields such as software engineering, artificial intelligence, and digital marketing.

The legislation has effectively dismantled this ecosystem. Leading companies, including Dream Sports, Mobile Premier League, Games24x7, and WinZO, have suspended operations. Nazara Technologies, the only publicly traded Indian company with exposure to real-money gaming, lost an estimated $260 million in market capitalization within a week of the announcement.

For global investors such as Tiger Global, Peak XV Partners, and Alpha Wave Global, the ban has translated into substantial write-offs. The Indian government also faces revenue losses of approximately $2.3 billion annually in goods and services tax and income tax collections, funds that are now likely to move offshore into unregulated markets.

India’s $23B Online Gambling Ban

Investor Confidence and Regulatory Stability

The abrupt passage of the bill, completed within just three days, has amplified concerns about regulatory predictability in India. The elimination of a sector valued at $23 billion in enterprise terms sends a signal to investors about the potential risks of sudden and sweeping policy changes. Venture capital firms and private equity funds now face large-scale losses, while companies have already begun mass layoffs.

This unpredictability may affect not only gaming but also other sectors of India’s digital economy, as investors weigh the risk of future abrupt policy reversals against potential opportunities in emerging markets such as web3, fintech, and digital entertainment.

India’s $23B Online Gambling Ban

The International Contrast

India’s policy choice stands in stark contrast to developments in the United States, where gambling has been legalized and regulated in most states. Following a 2018 Supreme Court ruling, 39 states, Washington D.C., and Puerto Rico now permit sports betting in some form, with 32 offering online betting. Today, more than 72 million Americans maintain online betting accounts.

The U.S. experience shows that gambling can be integrated into the economy with regulatory safeguards designed to reduce harm. Policymakers there have implemented measures such as spending limits and support services, choosing regulation over prohibition. The philosophical difference between India’s approach and that of the United States is significant, particularly in how each government balances economic development with concerns about public welfare.

India’s $23B Online Gambling Ban

The Uncertain Future of Gambling in India

Although the federal government has imposed a comprehensive ban, several Indian states are pursuing their own frameworks for regulated gambling. Karnataka, Maharashtra, Haryana, Andhra Pradesh, and Uttarakhand are all exploring ways to create licensing systems, whitelist legitimate operators, or distinguish between skill-based and chance-based games.

The Supreme Court of India is also expected to rule on questions surrounding the legality of skill gaming and the applicability of goods and services taxes. These rulings could determine whether state-level regulation has room to operate despite the federal prohibition.

International pressure may also influence India’s position. As the country seeks to strengthen its reputation as a global technology hub, policies that discourage innovation and foreign investment may prove counterproductive. Other jurisdictions, including the United States, are integrating gambling into regulated frameworks, raising questions about whether India’s prohibitionist approach could isolate it economically.

India’s $23B Online Gambling Ban

Final Thoughts

India’s ban on online real-money gaming eliminates a rapidly growing industry and removes billions of dollars in potential tax revenue and investment. The government has framed the prohibition as a moral and social protection measure, but the decision has dismantled a sector employing thousands of people and has shaken investor confidence in the stability of India’s regulatory environment.

The selective targeting of online gambling while leaving other digital risks unaddressed, combined with the abrupt legislative process, highlights the tension between cultural perception and evidence-based policymaking. As the global trend moves toward regulated gaming markets, India’s choice of prohibition underscores a policy divergence that could have lasting consequences for its economy and international investment appeal.