If you cast your eyes on all the online casinos available in India, you’ll notice that all licensed operators are internationally renowned and based overseas.
This is more of an accident than design, however, as India’s outdated gambling legislation (namely The Public Gambling Act of 1867) obviously makes no provision at all for online verticals or remote betting. While the subsequently formed Information Technology Act 2000 regulates cyber activities in India, this doesn’t reference either gambling or betting and has left such topics open for wider interpretation.
As a result of these factors, there’s nothing to expressly prohibit natives from accessing overseas casinos, so long as the operators in question offer Indian rupees as a primary method of payment.
In this article, we’ll take a closer look at the wider gambling laws in India while asking whether there’s a viable case to be made for legalising and regulating online casinos nationwide.
What Does the Law Say in India?
In general terms, gambling in India is a state subject, as every local authority within the region has the autonomy to formulate unique laws for wagering activities on behalf of their subjects.
Despite this, just three of the 29 states and seven union territories have sought to legalise one or more types of offline gambling in India, namely Sikkim, Goa, and Daman.
Unsurprisingly, it’s these states that have sought to push for the legislation and comprehensive regulation of iGaming in India, with Sikkim having planned to offer three online gambling licenses back in 2010. These attempts failed, however, despite local demand for such licenses and the desire of players to bet on popular casino games.
With states unwilling to officially legalise online gambling, there’s currently no opportunity for local or domestic operators to enter the marketplace.
As we’ve already mentioned, there’s no specific law that prohibits players from wagering through international operators such as Royal Panda or Betway Casino. So, despite more recent attempts to crack down on this practice in some quarters, Indian residents are still largely free to play casino games and wager on their favourite sports daily.
The Case for Legalising Online Gambling in India
This brings us neatly onto the case for legalising and regulating iGaming in India, which is certainly compelling from a tax and revenue perspective.
At present, for example, it’s estimated that the cumulative value of India’s online gambling industry is a whopping $930 million, which is reflective of the huge demand in the nation and the average amount currently wagered annually online.
However, this money is currently being diverted into the coffers of international operators and the treasuries of economies such as the UK and the US.
This surely represents a golden opportunity that is being squandered by the Indian government and state authorities, as this income could be generated on behalf of domestic operators and reinvested into the national economy.
To provide further context, let’s look at the example set by New Jersey. One of the first US states to legalise online casino gambling (and subsequently sports betting) back in 2012, NJ has become a highly generative and lucrative state and one that has blazed a trail for others (including Delaware and Pennsylvania) to follow.
By licensing and regulating iGaming, the state has been able to apply a tax rate of 15% to slots and table games. Remote sports wagers are currently taxed at 8.5% if they’re placed in brick-and-mortar casinos and the higher rate of 13% if they’re executed online.
As a result, NJ has banked incrementally higher tax revenues over time, with this peaking through 2020 and the first half of 2021.
For example, February saw the state generate a total of $5.8 million in tax from remote sports betting alone, while this number peaked at an astonishing $53.8 million prior to the coronavirus pandemic in January 2020.
This makes a compelling case for the legalisation of online casinos in India, especially as this developing economy continues to grow and evolve at a rapid pace.
Furthermore, the overall gambling market is thought to be worth $60 billion in total, but a staggering half of this is currently wagered illegally. This not only equates to more lost tax revenue but also suggests that punters could be at the mercy of rogue operators in some instances.
For example, it is estimated that bets worth as much as Rs 1,300 are placed on every One-Day International (ODI) match that the Indian cricket side contests, with this data accrued from 2015.
During this period, the Indian cricket side played a staggering 21 ODI matches, equating to a total betting amount of Rs 27,300.
Not only does this equate to a considerable sum from the perspective of tax revenues, but it’s also crucial that everyone’s bankroll is protected at all times. Otherwise, trust may be eroded over time, creating a scenario where demand dwindles before states have the opportunity to fully legalise and monetise iGaming.
