Inter-Ministerial Panel Has Been Established to Review and Strengthen Regulations Related to the Online Gaming Sector

It is learnt that the fresh attempt is being led by the Union Home Ministry, with an inter-ministerial panel being formed to formulate tighter rules.

New Delhi, India (November 25, 2023) — According to local media reports there are ongoing efforts in India to review and strengthen regulations related to the online gaming sector. The key concerns revolve around offshore betting apps masquerading as online games and potential money laundering associated with players in the sector. The Union Home Ministry is leading this initiative, forming an inter-ministerial panel to develop tighter rules.

The current regulations, which include a self-regulatory model, have faced criticism, leading to a push for more stringent norms to address issues related to online betting. In April, the Ministry of Electronics and IT (MeitY) introduced rules for online gaming, allowing for the creation of self-regulatory bodies with government oversight. However, an informal inter-ministerial group of ministers (GoM) has been established to reassess the online gaming ecosystem comprehensively.

The GoM reportedly includes key ministers such as Home Minister Amit Shah, Finance Minister Nirmala Sitharaman, IT Minister Ashwini Vaishnaw, Minister of State for Electronics and IT Rajeev Chandrasekhar, and Commerce Minister Piyush Goyal, among others. Different ministries, especially Home and Finance, want to contribute to the regulations governing the online gaming sector.

The Home Ministry is concerned about deterring online gambling platforms, while the Finance Ministry aims to address potential violations of money laundering norms. There is a particular focus on taking a firm stance on offshore betting platforms, influenced by incidents like the fallout of the Mahadev betting app in Chhattisgarh.

It’s mentioned that the 28% Goods and Service Tax (GST) on the online gaming space was one of the initial actions, and there’s a consensus that rules need to be stricter to regulate betting sites and prevent money laundering effectively.

As of now, the gaming rules notified by the IT Ministry have been put on hold, awaiting recommendations from the GoM. The IT Ministry has not accepted proposals to set up self-regulatory bodies, and these bodies are unlikely to be formed until the GoM provides its recommendations. The GoM is expected to officially meet in the first two weeks of the following month, likely on December 15.

These developments indicate a coordinated effort by multiple ministries to address concerns and potentially overhaul regulations in the online gaming sector in India.