Online Gaming Needs Regulation
Not Blanket Prohibition

On 19 August 2025, the Union Government tabled the Promotion and Regulation of Online Gaming Bill, 2025, in Parliament. For the first time, India has before it a national framework that seeks to tackle the real harms of the online gaming industry while also giving a boost to e-sports and social gaming.

But the Bill has also triggered a heated debate. Editorials warn of stifled innovation and moral overreach. Industry players speak of a “death knell” for real-money platforms and States have expressed unease at being sidelined. Even as the e-sports community hails the Bill as a recognition of their legitimacy, others see in it the seeds of a centralised prohibitionist regime.

As someone who has worked with colleagues across law, policy and industry to propose a responsible digital gaming framework, I find myself reflecting on what we got right—and where the Bill may require a course correction.

SKOCH Advocacy: A Different Path

SKOCH advocacy was rooted in three core ideas:

1. Move beyond the outdated binary of skill vs. chance. Both kinds of games can harm users; regulation should be based on user risk and design intent, not semantics.
2. Recognise gaming as a high-risk industry that needs more than self-regulation. The days of voluntary codes and self-certification are over.
3. Treat gaming as an issue of public health and digital responsibility. Addiction, psychological harm and manipulative design are not abstract risks—they are visible in clinics and families across the country.

We proposed a Risk-Purpose Matrix that classifies games into zones depending on harm and purpose. We urged for Corporate Digital Responsibility (CDR) indicators: Grievance Redressal, Parental Controls, Detox Prompts, Play-Time Limits, Dopamine Audits and Ergonomic Safeguards. Above all, we argued for co-regulation—an authority at the Centre for standards, payments and cross-border enforcement, with States empowered to set stricter rules on public health and outreach.

This was not a call for a free-for-all. It was a call for proportionality and ethics, for regulation as stewardship, not prohibition.

What the Bill Does

The Bill, 2025 takes a much harder line. It recognises e-sports and social games and establishes a central authority with sweeping powers. But it also prohibits all online money games—irrespective of whether they are skill-based, chance-based or somewhere in between.

The Bill sweeps away not just predatory operators but also any scope for responsible innovation in the real-money gaming segment. It centralises jurisdiction with the Union Government, leaving States with little more than an implementation role. It recognises the harms but offers prohibition as the only solution.

Why Blanket Prohibition Is Risky

A prohibitionist stance may appear strong, but it risks three serious consequences:

1. Pushing the market offshore: Users will not stop gaming; they will simply shift to unregulated apps hosted abroad, beyond India’s jurisdiction.
2. Losing tax revenue: A market worth ₹20,000 crore in potential taxes may evaporate into the grey economy.
3. Stifling innovation: India’s young developers, who could build the next generation of responsible, skill-based platforms, will be driven out or underground.

Most importantly, prohibition does not solve the mental health crisis. It simply makes it invisible, harder to detect, and impossible to treat through regulated safeguards.

A More Prudent Path Forward

A wiser approach would be to retain the Bill’s recognition of harm and its institutional architecture, but replace prohibition with risk-based licensing.

• Licensing with strict CDR compliance: Operators could be licensed only if they meet auditable benchmarks on grievance redressal, parental controls, play-time limits, dopamine-neutral design and ad restrictions.
• Central + State co-regulation: The Union handles cross-border enforcement, payments and standards. States regulate local advertising, outreach and add stricter rules where needed..
• Graduated enforcement: Keep tough penalties for unlicensed operators, but allow a lawful, monitored channel for those who comply.
• Transparency and dashboards: Quarterly reports on complaints, audits and risk profiles should be made public.
• Sandbox innovation: A regulatory sandbox could allow new entrants to test harm-aware designs under supervision.

This would combine the Bill’s strengths (central authority, recognition of e-sports, national security vigilance) with the SKOCH framework’s safeguards (mental health, harm classification, co-regulation).

The Mature Voice of Sanity

Regulation of online gaming is overdue. In families across India, stories of addiction, bankruptcy, even suicides have been linked to uncontrolled gaming platforms. Parliament is right to act.

But prohibition is a blunt instrument. It may win headlines, but it does not build a sustainable system. A federal, risk-based, harm-aware regime would do more: protect youth, preserve tax revenues, encourage responsible innovation and respect our constitutional balance.

India stands at a crossroads. We can either outlaw an entire industry and drive it underground, or we can shape it into something responsible, transparent and globally competitive. The choice is not between chaos and prohibition—it is between bad regulation and good regulation.

India stands at a crossroads. We can either outlaw an entire industry and drive it underground, or we can shape it into something responsible, transparent and globally competitive. The choice is not between chaos and prohibition—it is between bad regulation and good regulation.

That is the mature voice of sanity this moment demands.