India market requires combined enforcement approach
The burgeoning gambling market in India has revealed that illegal operators are flourishing, with four notable platforms alone attracting a staggering 1.6 billion visits over three months.
The recently published “Gambling and Betting Market in India” report from the Digital India Foundation highlights the urgent need for stricter regulations to address the proliferation of illegal gambling sites across the nation.
This comprehensive analysis explores the clandestine gaming ecosystem in India, detailing its enablers and assessing enforcement strategies implemented in various global contexts to combat the escalating threat posed by the black market. The report specifically scrutinizes player activity across four prominent offshore brands: Parimatch, Stake, 1xBet, and BeteryBet.
Current estimates suggest there are approximately 448 million players engaging in various online gaming activities in India—from console gaming to social platforms and real-money gambling.
In a related study released in October 2024 titled “Combating Money Laundering in the Online Gaming Ecosystem,” the Digital India Foundation raised alarms about the risks of fraud, money laundering, and potential terrorism financing within the country’s online gaming sector.
The think tank advocates for “enhanced oversight, more robust KYC (Know Your Customer) practices, and improved anti-money laundering systems by financial institutions.”
An Overview of India’s Licensed Gambling Market
As it stands, online sports betting remains illegal in India, while table games and slot machines are permissible only in casinos located within the states of Goa and Sikkim, and only on-site.
The Public Gambling Act of 1867 prohibits the establishment of gambling houses, patronizing such facilities, and even the possession of gambling devices, with limited exemptions for games classified as skill-based.
This statute was supplemented by the Prize Competition Act of 1955, which aimed to impose further restrictions on gambling that involves prize incentives.
Despite initiatives in 2023 by the Ministry of Electronics and Information Technology to establish self-regulatory bodies for gambling oversight, the absence of a cohesive federal framework continues to hamper progress due to its complexity and scope.
A recent report by venture capital firm Lumikai, published in November 2024, estimates that around 10% of Indian smartphone users, approximately 148 million individuals, are actively spending money to play online games. It projects that the real-money gaming sector in India could generate revenues of $3.6 billion by 2029.
Channels of Access to Illegal Gaming Sites
The Digital India Foundation’s analysis reveals a substantial volume of traffic directed to illegal sites primarily through social media platforms, accounting for about 42.8 million visits. Additionally, referrals from adult sites or streaming promotions contributed to an impressive 247.5 million visits.
Nevertheless, the predominant source of visits—1.1 billion—stemmed from players directly entering URLs, showcasing the effectiveness of illegal operators’ previous marketing efforts.
Researchers examined more than three years of Google search trends, from February 2021 to December 2024, noting an “exponential rise” in searches for illegal platforms such as Dafabet, 1xBet, Parimatch, 4rabet, and Khelo24Bet.
“The vast scale and resilience of these markets illustrate that the illegal gambling and betting ecosystem in India operates through a sophisticated network of mechanisms that ensure its reach and functionality,” the report stated.
Furthermore, the Digital India Foundation observed an increase in the use of cryptocurrencies and mixing services, which obfuscate the trail of transactions, facilitating illegal activities.
A Call for Strategic Reform
The report advocates for a paradigm shift in the Indian government’s approach to regulating illegal online gambling. It recommends abandoning the current “fragmented” enforcement tactics in favor of a cohesive “ecosystem-based” strategy that addresses not only the illicit websites but also the underlying enablers of such activities.
Drawing insights from jurisdictions like the UK, US, Denmark, and Norway, which employ diverse tactics against illegal gambling, the Digital India Foundation finds that combining marketing restrictions with website and payment blocking leads to more successful outcomes.
It suggests that India should curb digital media channels driving user engagement towards these illegal platforms while enhancing financial regulation to obstruct illicit transactions.
To strengthen compliance, the report calls for digital platforms—especially social media—to enforce stringent advertising policies that ban direct paid promotions for illegal operators and improve moderation to identify and remove user-generated content linked to such markets.
Moreover, it proposes that the Reserve Bank of India formulate guidelines compelling financial systems and banks to develop mechanisms that block transactions associated with illegal gambling activities.
