The gaming industry is closely monitoring India’s market developments and public discourse surrounding betting and online gaming, with Parimatch among the international companies viewing India as a strategic growth opportunity. Simultaneously, established operators like Parimatch advocate that sustainable investment and proper tax compliance necessitate transparent and attainable regulatory frameworks. In this context, the trajectory selection becomes critical: complete prohibition or structured, enforceable regulation that maintains market operations within legal boundaries.
The Regulatory Challenge
India’s parliament enacted the Online Gaming Promotion and Regulation Act, effectively prohibiting real money gaming (RMG) operations online, encompassing advertising and associated financial transactions. Supporters reference “elevated risks of financial and psychological damage” and emphasize the necessity for “stringent measures” to tackle social issues. Legal violations carry penalties of up to three years incarceration plus monetary fines.
Market Response: Operational Shutdowns and Industry Realignment
The parliamentary decision triggered immediate market reactions: leading companies initiated shutdowns of real money gaming services and imposed deposit restrictions. Dream Sports, operating Dream11, Dream Picks, and Dream Play applications, considered complete divisional closure following law implementation during internal strategy sessions. Mobile Premier League (MPL) halted all premium gaming services and deposit processing while initiating customer refunds. Gaming startups Zupee, Probo, and Gameskraft terminated RMG operations. Furthermore, Times Internet declared Cricbuzz11 project suspension.
Amid these developments, industry organizations and operators explored potential Supreme Court appeals, despite acknowledging challenging legal prospects. Concurrently, numerous employees have begun public job searches on social platforms, anticipating widespread employment reductions in upcoming weeks.
The federal GST council simultaneously implemented a 28% online gaming tax (increased from 18% previously applied solely to commissions). This revised structure taxes both commission and wager amounts. Players face substantially higher participation costs, while operators predict widespread business model failures. Major corporations might adapt successfully, but medium and smaller platforms approach “closure thresholds.” Industry experts stress that transparent regulation, rather than prohibition and excessive taxation, can maintain legal industry operations and foster sustainable growth conditions.
Legal Distinction Complexities: “Skill versus Chance”
Indian jurisprudence traditionally differentiates between skill-based and chance-based gaming. Fantasy cricket platforms, rummy, and poker leveraged this classification, securing favorable court rulings as “skill-dependent” activities. Current legislation and tax modifications eliminate this distinction, applying stricter requirements to previously “skill-based” offerings. Consequently, fantasy sports, a primary mobile gaming driver in India, faces potential monetization elimination.
Sports betting remains formally prohibited nationwide (excluding traditional horse racing). Practically, this created extensive underground markets, particularly cricket-focused, with estimated shadow revenues reaching tens of billions of dollars across millions of participants. Complete RMG prohibition will likely channel demand toward unregulated environments lacking oversight, responsible gaming protocols, or tax contributions.
For international operators assessing India’s potential, the fundamental concern transcends “skill versus chance” classifications toward establishing legal frameworks distinguishing legitimate services from underground operations. Industry consensus suggests only comprehensive regulation and licensing can balance player protection with revenue generation while encouraging sustained sector investment.
Self-Governance Framework: Exploring Alternative Solutions
2023 regulations introduced self-regulated organizations (SRBs) designed to validate “authorized” RMG offerings and establish transparent operational standards (including algorithmic fairness mandates). However, essential implementation details (procedural guidelines, decision-making requirements, enforcement mechanisms) never achieved operational status, with several technical specifications removed during final stages. Without clearly defined SRB structures, the industry experiences unpredictability while government lacks effective oversight mechanisms.
Prohibition advocates emphasize addictive design elements, youth exposure risks, and social consequences (financial debt, family disruption, criminal activities). Nevertheless, international evidence demonstrates that access restrictions without comprehensive support measures (education initiatives, risk identification, age verification, spending/time controls, assistance resources) produce limited long-term effectiveness. Young users develop circumvention strategies, and problems relocate rather than disappear.
Industry communications to government officials estimated Indian RMG startup valuations at approximately ₹2 trillion (~$23 billion), generating ₹310 billion (~$3.6 billion) in revenues and contributing ₹200 billion (~$2.29 billion) in annual taxation. The market previously demonstrated 28% compound annual growth rates with projections suggesting 2028 doubling potential. Rapid prohibition transitions challenge employment levels, innovation capacity, and tax foundations while maintaining illegal demand channels.
Given proposed regulatory changes, analysts emphasize legal framework quality and intellectual property protection importance. International operators have encountered brand counterfeiting within Indian markets, damaging consumer trust and impeding legitimate service development and partnership formation. Companies stress that without conditions ensuring competitive equality for international enterprises, substantial investments remain problematic.
India’s Counterfeit Gaming Ecosystem: Beyond Brand Imitation
Legal sector development faces significant threats from widespread counterfeit gambling brand proliferation. Indian fraudulent operators systematically create replica websites and mobile applications mimicking established international brands including Parimatch, Bet365, Stake, 1xBet, and similar platforms. These fraudulent sites replicate corporate branding and functionality, deceiving users. CUTS International research indicates illegal platforms—including counterfeit versions targeting users of legitimate brands like Parimatch, Stake, and Fairplay—generated over 5.4 billion visits during fiscal 2025. This volume surpasses major digital platforms, illustrating the problem’s magnitude.
Counterfeiting methodologies vary extensively. Pre-developed “clone-script” technologies enable rapid deployment of sites resembling major operators within days. Unauthorized mobile applications distributed outside official channels perfectly replicate established platform interfaces. Telegram channels and automated systems are extensively utilized—major operators regularly alert users about fraudulent Telegram bots collecting funds through fake “promotional offers.”
Government responses include police raids, domain blocking, and server seizures by state cyber units, though effectiveness remains limited. Offshore jurisdiction usage, anonymous registrations, and cryptocurrency transactions complicate prosecution efforts and extend legal processes. Brands consequently suffer reputation damage while users remain vulnerable to fraudulent operations. Research indicates illegal sites specifically target younger demographics and financially vulnerable populations, promoting “instant betting” and unrealistic payout promises.
Within this environment, established international operators stress that counterfeit prevention must integrate with regulatory policy development. Otherwise, prohibition measures or tax increases will stimulate shadow market expansion, already demonstrating rapid growth patterns.
Parimatch’s Strategic Vision: Regulation as Market Foundation
Complete RMG prohibition combined with 28% goods and services taxation significantly contracts legal market segments. However, consumer demand persists but transitions to unregulated and high-risk channels.
Comprehensive regulation represents the optimal pathway for market development. This encompasses unified federal standards, operational self-regulated organizations (SRBs) with defined procedures and algorithmic auditing, age and behavioral restriction implementation, payment transparency requirements, responsible gaming mechanism development, and robust intellectual property and brand protection measures.
For India, this approach preserves employment opportunities, tax revenue streams, and innovation advancement. For international companies like Parimatch, structured regulation provides operational predictability and market stability. Such regulatory architecture would effectively open Indian markets to established operators like Parimatch, enabling contributions to India’s digital gaming ecosystem through legal, transparent, and responsible gaming platform development.
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