Indian Video Games Industry Seeks Distinction From Real Money Games, Sends Policy Suggestions to Centre

A consortium of Indian video games and esports companies have written to the newly formed government, requesting a comprehensive industry-focussed policy, regulatory streamlining and a clear distinction from real money games that are often conflated with video games under the “Online Games” umbrella term. In addition to clear classification, the video games industry in the country, represented by over 70 companies, has also made nine further suggestions to help accelerate the growth of the gaming sector in India.

Indian video games industry writes to PMO

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

“The Indian Video Games Industry has requested the newly formed Indian government to break the existing categorisation of online games into two separate categories — video games and real money games, for fair and equitable policymaking and to boost the sunrise sector's growth in a new representation letter to the Prime Minister's Office and to the office of the Minister of Information and Broadcasting (MIB),” a press release from the companies said.

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

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 staking” — and real money games.

“We urge the government to take a measured and nuanced approach to video games as they have definite potential to spearhead India's creative economy and soft power aspirations,” Chengaiah said.

Policy suggestions for Indian video games industry

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

The companies also recommended appointing the I&B Ministry as the Nodal Agency for video games in the country. Additionally, the stakeholders sought the rationalising of import duties and easing of customs process for crucial proprietary development hardware. The companies also suggested that video games be moved from 18 percent to 12 percent Goods and Services Tax (GST) bracket.

The communication from the video games industry in India arrives almost a year after industry stakeholders wrote a similar letter to the government over ‘Online Games' tax, calling for distinction from real money games.

Last year in July, the Goods and Services Tax (GST) council imposed a 28 percent 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 at the time announced the new taxation policy.