Examining India’s sports betting and gaming sector

By christopher heyes

UKIBC has long called for the regulation of the sports betting market in India and over the last few weeks we have started to see a slight shift in this area from some of the States.

It is well accepted that sports betting is prevalent across large parts of India and, despite being illegal, represents a huge market. It is estimated the market is worth around $150bn and rising by 7 percent a year. For instance, it is estimated that for every one-day international played by the Indian Cricket team $200m is bet!

There are lots of undesirable consequences from this largely illegal unregulated industry. There is of course the huge revenue losses for each of the States; revenues that could significantly support grass route sports and sports infrastructure. However, equally important is the lack of traceability of funds, the increased possibility of corruption in sport and of course the lack of support available to those placing the bets.

As our recent report discloses, the major challenge that exists in India is determined by whether what you are betting on is deemed as a game or skill or chance.

Most States permit games of skill, which are excluded from the remit of gambling. Without a legislative definition, the Supreme Court has established, in several cases, that games of skill are quite simply where the element of skill dominates the element of chance, and vice-versa for games of chance. Our report showed that Poker, Rummy and Fantasy sports were deemed as games of skill and therefore allowed in India. (Fantasy League Sports (FLS) are where players construct and contest their fantasy teams comprised of their own selection of real sports people such as fantasy cricket or football.)

Games of chance for stakes, however, do fall within this remit and are therefore largely prohibited with the exception of some lotteries. Some States, such as Goa and Sikkim, have created exceptions within their gambling acts for authorised gaming, issuing licenses for games of chance in casinos on land and offshore. The Sikkim Casino Games Act 2004 also allows casino operations.

To illustrate the complexity of gaming regulation across India, in our report we devised an index that measured the extent to which each State has legalised gaming and betting based on their stance on seven different games. The anomalies make for interesting and surprising reading.

So with so many complex and conflicting challenges is India worth the gamble to invest in? There are many in the fantasy sports sector that think so. In 2016 there were only 10 companies operating. By 2018 this had risen to 70 with a forecast that there will be 100 million fantasy sports users by the end of this year and whilst play under free version the length of time and regulatory of their visits to the sights means advertising revenues are lucrative.

Fantasy cricket as you can imagine still dominates but its dominance is starting to be watered down as football, kabaddi and basketball are on the rise in popularity in India.

So what next for India`s sports and gaming market? For such a tech savvy country where 85 percent of gaming takes place on mobile phones will it be online quiz games? E-Sports? Or perhaps more traditional games? We continue to watch and continue to advocate for change via our four key recommendations:

  1. Legalise and regulate the gaming market across India, particularly sports betting.
  2. The gaming market spans the entirety of India, it therefore needs to be regulated centrally, rather than at the State-level;
  3. Draft and enforce clear, intuitive, and effective responsible gambling and gaming regulations. These should draw from international best practice to prevent underage gambling, addictive, and financial difficulties.
  4. Regulation should be game-neutral – applied to the wide variety of gaming that exists online and across the sporting world.

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