Indian video game industry seeks separation from real-money gaming, sends policy suggestions to Centre


An association of Indian video game and esports companies has written to the newly formed government requesting an industry-focused comprehensive policy, regulatory streamlining, and a clear distinction from real-money games, which are often lumped with video games under the umbrella term “online games”. Apart from clear classification, the video game industry in the country, represented by over 70 companies, has also made nine more suggestions to help accelerate the growth of the gaming sector in India.

Indian video game industry writes letter to PMO

In a letter sent to the Prime Minister’s Office (PMO) and the Ministry of Information and Broadcasting (MIB) on Tuesday, Indian video game companies have sought a “comprehensive, video game-focused policy” in line with global best practices. The companies also requested the government’s support to enhance original IP made in India and legislative and regulatory streamlining to help bring clear policies for video games in the country.

“The Indian video games industry, in a new memorandum sent to the Prime Minister’s Office and the Office of the Minister of Information and Broadcasting (MIB), has requested the newly-formed Indian government to split the existing classification of online games into two distinct categories – video games and real money games – to enable fair and equitable policy making and promote growth of the emerging sector,” a press release issued by the companies said.

Outlier Games founder and CEO Harish Chengaiah, who also organised the Association of Indian Game Developers, citing data from video game market research firm Niko Partners, said the video game industry in India is set to be worth $942 million (roughly Rs. 7,864 crores) in 2024. The games sector in India is projected to reach $1.6 billion (roughly Rs. 13,357 crores) by 2029, surpassing the cumulative revenue of all Indian film industries and becoming the country’s largest entertainment industry.

The Outlier Games CEO also sought to draw a clear line between video games — “purely entertainment-oriented digital games that do not have an element of monetary stakes” — and real-money games.

“We urge the government to take a balanced and nuanced approach to video games as they have the definite potential to boost India’s creative economy and soft power aspirations,” Chengaiya said.

Policy suggestions for the Indian video game industry

In their letter to the PMO and the office of Union Information and Broadcasting Minister Ashwini Vaishnaw, companies representing the video game industry in India have also shared ten suggestions for the government as part of a national AVGC-XR policy to help accelerate the growth of the sector in the country. These include demanding a clear distinction between video games and real money games for favourable policy making and curbing misrepresentation in the media.

The companies also recommended appointing the Ministry of Information and Broadcasting as the nodal agency for video games in the country. Additionally, stakeholders sought rationalisation of import duties and easing of customs procedures for critical proprietary development hardware. The companies also suggested that video games should be brought under the ambit of Goods and Services Tax (GST) from 18 per cent to 12 per cent.

This letter from the video games industry in India comes almost a year after industry stakeholders wrote a similar letter to the government regarding ‘online games’ tax, seeking a distinction from real-money games.

In July last year, the Goods and Services Tax (GST) Council had imposed a 28 per cent tax on online gaming, casinos and horse racing. Then Finance Minister Nirmala Sitharaman, who took over the reins of the ministry again last month, had announced the new taxation policy at that time.

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