A Nation's Passion Criminalized: India Bowls Out Sports Betting
By David B. Hoppe, Managing Partner, Gamma Law, San Francisco, United States of America
In a decisive and unexpected policy reversal, the Indian Parliament, in August 2025, has passed the Promotion and Regulation of Online Gaming Bill into law. Despite its ostensibly regulatory title, the legislation effectively outlaws one of the nation's most popular digital pastimes: online sports wagering and fantasy sports. The action is part of a broader ban on online real-money gaming, a cornerstone of the nation's US$23 billion (around €19.8 billion) digital entertainment sector in an effort to alleviate mounting concerns over financial losses and gambling addiction, as well as national security risks, such as money laundering and terror financing.
This decisive act criminalized an industry built around the deep-seated passion for cricket, soccer, and kabaddi, abruptly ending a period of rapid growth and regulatory ambiguity. The ban represents a profound cultural and economic shift, threatening not just a multi-billion-dollar market but a fundamental shift in how millions of Indians engage with the sports that they love.
Targeting Sports Wagers
Meticulously crafted to eliminate the entire ecosystem of real-money sports engagement, the legislation moves far beyond a simple prohibition:
· Ending the “Game of Skill” Defense: The law's most critical blow was its rejection of the "game of skill" argument, the very legal foundation upon which major fantasy sports platforms like Dream11 and My11Circle had built their businesses. By imposing a universal ban on all online games involving monetary stakes, it rendered irrelevant the years of legal battles that had distinguished fantasy cricket from pure gambling. Overnight, creating a paid fantasy team or placing an online bet on a cricket match became a criminal activity.
· Crippling the Ecosystem with Penalties: The law has targeted every participant in the sports gaming chain. Operators of sports betting and fantasy platforms now face up to three years of imprisonment. Crucially, the ban extended to the celebrity cricketers and film stars who endorsed these platforms, threatening them with two-year sentences and instantly vaporizing a massive revenue stream for sports leagues and influencers. Financial institutions were also barred from processing transactions, severing the industry's financial lifeline.
· Blacking Out Advertising: A complete prohibition on advertising and sponsorships has struck at the industry's visibility. This means the immediate disappearance of fantasy sports branding from cricket team jerseys, stadium hoardings, and television commercials during Indian Premier League (IPL) matches, effectively erasing the industry from public view and cutting off its primary channel for user acquisition.
Legal Challenges: The Battle for Legitimacy
The ban has triggered constitutional challenges that question the legitimacy of Indian government's action:
· Jurisdiction: The sports betting industry has been a subject of intense debate amongst state governments. Some states, like Sikkim, had established their own licensing frameworks, while others openly considered legalization to curb black markets and generate tax revenue. The central government's blanket ban is challenged as an overreach into a domain constitutionally reserved for state legislatures, setting up a pivotal federalism dispute.
· Due Process: Fantasy sports companies, in particular, argue a powerful case of violated due process. They invested billions of dollars based on explicit legal victories from various High Courts and the Supreme Court, which had affirmed their model as a game of skill. The retroactive criminalization of these court-approved operations is framed as an arbitrary state action that destroys legitimate business expectations and undermines judicial authority.
· Commercial Speech: The advertising ban faces a direct challenge under free speech protections. The ubiquitous presence of fantasy sports in sports broadcasting had woven it into the fabric of modern sports consumption in India. The argument is that a total prohibition on this commercial speech is disproportionate, especially when it pertains to activities that were, until recently, legally protected as skill based.
Industry Survival Strategies: Pivot or Perish
Confronted with an existential threat, the sports-focused industry is pursuing several paths to survival:
· Aggressive Resistance: Market leaders like Dream11 are leading the legal charge, leveraging their vast user bases and previous legal wins. Their strategy is to secure interim relief from the courts, potentially allowing fantasy cricket operations to continue whilst the constitutional challenges are heard, a critical move to preserve their business during lengthy legal proceedings.
· Business Model Adaptation: Many platforms are attempting a rapid transformation into free-to-play models, where users can compete for non-monetary rewards or branded merchandise. The monumental challenge is whether advertising revenue and brand partnerships alone can sustain the high platform maintenance and the user acquisition costs previously funded by entry fees and vigorish.
· Black Market Temptation: The ban creates a vacuum that unregulated, offshore sportsbooks and betting platforms may rush to fill. Whilst legitimate domestic operators are forced to exit, international or illicit sites will likely target Indian consumers using cryptocurrency and VPNs. This shift ironically exposes users to greater risks of fraud and addiction, the very issues the ban aimed to address, whilst moving a massive economic activity entirely underground.
Broader Implications for Sports and Economy
The ban’s impact reverberates far beyond the gaming apps themselves.
· Economic Shock: The gaming industry was a primary financier of sports leagues in India. The loss of sponsorship revenue from fantasy sports and betting companies will create a significant funding gap for cricket, football, and other leagues, potentially affecting player salaries, league expansion, and grassroots development.
· Investor Confidence: The sudden criminalization of a sector that attracted billions in venture capital and private equity sends a chilling message to investors. Digital arena investors have been told that a heavily invested, court-approved industry can be outlawed overnight.
The most probable long-term resolution is not the permanent eradication of sports wagering, but an eventual political and regulatory reckoning. The current crisis may ultimately force the creation of a robust, federal framework that brings transparency, consumer protection, and taxation to a persistent consumer demand. For now, the final wicket on this industry has not yet fallen; the game has simply moved from the market to the courts.
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