Karnataka to introduce law regulating online gambling, betting; Draft in a month
The new legislation is aimed at regulating online gambling and betting platforms to curb fraudulent practices and support the legal gaming sector
Bengaluru: The Karnataka government is planning to introduce a new legislation aimed at regulating online gambling and betting platforms to curb fraudulent practices and support the legal gaming sector, a senior cabinet minister said on Wednesday.
Announcing the formation of a committee comprising senior officials and industry stakeholders to draft the proposed law, home minister G. Parameshwara said that the committee has been given a month to submit the draft. “I chaired a meeting regarding online betting and gambling along with the information technology (IT) minister. Representatives from the industry were called. There is nothing to regulate them so far. They have agreed to the introduction of a licence system and regulation as per law,” he said.
Parameshwara added that once the draft is ready, the government plans to introduce a new law based on regulatory models like that of Chhattisgarh, which differentiates between gambling and skill-based gaming.
”The proposed law is designed to prohibit games of chance while supporting innovation and the growth of skill-based online gaming,” Priyank Kharge, minister of electronics, information technology & biotechnology and rural development & panchayat raj, who has been involved in the drafting process, said, adding the intention is to “protect users from financial fraud and exploitation” while ensuring the “legitimate gaming industry continues” to thrive.
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Highlighting the importance of Karnataka’s role in the country’s online gaming landscape, Kharge said, “The legitimate online skill-based gaming industry in India is a sunrise sector worth USD 4 billion, contributing ₹12,000 crore in taxes and creating over 1.5 lakh jobs. Karnataka alone accounts for 25% of the market and contributes ₹1,350 crore annually in taxes, making it a key hub.”
However, the minister voiced his concern over the parallel growth of illegal and offshore betting operations. “Alongside the legitimate sector, there is a parallel underground market that is expanding rapidly, posing risks such as predatory money collection practices, dubious shell companies, financial fraud, data breaches, and cybercrimes,” he said.
Kharge said he recently consulted with stakeholders, including representatives from the E-Gaming Federation (EGF), the All-India Gaming Federation (AIGF), and the Federation of Indian Fantasy Sports (FIFS). These organisations have worked together on a ‘Code of Ethics’ for the gaming industry, which is expected to play a role in shaping the new legislation.
Despite a ban in place on online betting and certain gaming apps, the state continues to witness widespread use of such platforms, many of which operate from outside the country. “What is illegal must be banned first. If any platform is legal, we’ll work on how best to regulate it... There are laws already in place, but their enforcement has been lacking. We’ve held discussions on how to protect our citizens from falling victim to such platforms,” Kharge said.
