Blanket ban on online real money gaming will kill jobs, revenue, innovation: minister Priyank Kharge

Karnataka IT and Biotechnology Minister Priyank Kharge on Wednesday criticised the Centre's decision to impose a blanket ban on online real money gaming (RMG), calling it "another masterstroke by Modi Sarkar in bad policy making."

Kharge, son of Congress president Mallikarjun Kharge, said the decision would hit state revenues, jobs and investments.

"India earns Rs 20,000 crore annually from GST and income tax via online RMG. The ban means states lose this revenue stream," he said in a post on 'X'.


The minister noted that over 2,000 gaming startups and more than two lakh jobs in IT, AI and design would be at risk.


Warning of unintended consequences, the minister said, "Bans don't stop addiction or suicides. Instead, they push users to unregulated offshore platforms worth Rs 8.2 lakh crore annually where government has no control at all.

"Security risks: Unregulated sites ensure money laundering, terror financing, data theft. Even FATF and Rashtriya Raksha University warn against such risks."

Noting that the Supreme Court is still deciding whether the Centre or states have the power to regulate, Kharge questioned "Why the rush to ban now?"

He said prohibition is not the solution and called for regulating skill-based platforms, enforcing IT Rules, 2021, and whitelisting legitimate operators.

"A well-balanced regulation will ensure jobs, revenue, safer users, national security and global innovation," he said, cautioning that "a blanket ban will not only lead to revenue loss, but will give rise to illegal markets that might threaten national security and, of course, there will be a huge innovation setback. Regulation is the way forward."

The proposed promotion and regulation of online gaming bill, cleared by the Union Cabinet on Tuesday, prohibits online money gaming or its ads, and prescribes imprisonment or fine, or both, for those offering or advertising them, as it seeks to differentiate such games from eSports or online social games, according to a source.

At the same time, the bill calls for promotion of eSports and online social games, the source said, adding that it acknowledges that formal recognition of eSports will enable India to tune into global competitive gaming landscape, spur innovation, create opportunities for Indian startup ecosystem and make the country a global magnate for game development.

The bill proposes that any person offering online money gaming service in violation of the stipulated provisions will face imprisonment of up to three years or a fine that may extend to Rs 1 crore, or both.

The provisions also stipulate imprisonment of up to two years and or a fine of up to Rs 50 lakh, or both, for those indulging in advertisements in contravention of rules. Also, those engaging in any transaction or authorisation of funds will be liable for up to three years imprisonment, or a fine up to Rs 1 crore or both, according to the source.