Cabinet clears Online Gaming Bill, betting apps to face strict penalties

New Delhi: The Union Cabinet on Tuesday approved the Online Gaming Bill, giving India its first legal framework to regulate online gaming and impose penalties on gambling conducted through betting apps. Officials confirmed that the Bill will be tabled in the Lok Sabha soon.

The move comes at a time when online betting and gambling platforms have seen a sharp rise in usage, alongside growing concerns about addiction, fraud, and celebrity-backed promotions. Between 2022 and February 2025, the government blocked more than 1,400 betting and gambling websites and apps.

The Bill is aimed at bringing all online gaming platforms under a regulated system. It also sets penalties for gambling carried out through digital applications. Sources told reporters the Cabinet approval marks "a significant policy step toward monitoring the fast-growing online gaming industry and addressing concerns over unregulated betting apps.”

The government’s focus on the sector has been tightening for the past two years. Since October 2023, online gaming has been taxed at 28 percent GST. From FY 2024–25, winnings are taxed at 30 percent. Offshore platforms have also been pulled into the tax net, with authorities gaining the power to block illegal or unregistered sites.

Last year, the Bharatiya Nyaya Sanhita introduced new criminal provisions that make unauthorized betting punishable with up to seven years in prison and fines. Despite this, the Constitution still places "betting and gambling” in the State List, which means states have the primary authority to act against illegal platforms.

The new Bill is expected to streamline oversight by giving the Centre greater tools to regulate platforms nationally while leaving enforcement against local operators with state governments.

Officials say the Bill also comes in response to rising fraud cases linked to betting apps. Investigating agencies have been increasing scrutiny of offshore operators that fail to comply with Indian laws.

The Education Ministry has already issued advisories to parents and teachers on gaming addiction risks, while the Information and Broadcasting Ministry has instructed TV channels to run disclaimers on gaming advertisements about financial risks.

India’s online gaming industry, however, continues to grow at a rapid pace. A joint report by WinZO Games and IEIC, released earlier this year at the Game Developers Conference in San Francisco, estimated the market at $3.7 billion in 2024 and projected it to more than double to $9.1 billion by 2029. Real-money gaming alone contributes nearly 86 percent of revenues.

With the Cabinet’s approval, the Online Gaming Bill will move to the Lok Sabha for introduction. Industry players, meanwhile, are keeping a close eye on how the regulations will be structured and how penalties will be enforced once the Bill becomes law.