With more than 500 million digital gamers in 2024, India was fast emerging as one of the world’s largest gaming hubs. However, the passage of the Promotion and Regulation of Online Gaming Bill, 2025 on 22 August marks a watershed moment for the sector. The new law bans real money gaming (RMG) while formally recognizing eSports as a competitive sport, forcing a major industry reset.
Immediate Impact of the RMG Ban
The effect of the ban has been immediate. According to a recent Redseer report, the RMG segment—which attracted 80–100 million annual users and was projected to grow at 12–15% CAGR—has ground to a halt. The disruption extends beyond gaming platforms, hitting allied industries such as digital advertising, sponsorships, and payments infrastructure.
Growth Engines for the Future
Despite the challenges, three new growth avenues are emerging:
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Casual Gaming and eSports – Rising paid user bases, higher ARPPU (Average Revenue Per Paying User) growing from $2–5 in 2020 to $25–30 in 2024, and government recognition are fueling demand. India’s eSports market (~$40 million) is expected to expand at 30–35% CAGR, as brands engage younger audiences and publishers launch mass-market titles.
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Industry Adjacencies – Former RMG operators are diversifying into OTT, sports ticketing, analytics, merchandise, and gamification projects, building fresh revenue streams.
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Global Expansion – Indian-origin games and sports formats are gaining traction abroad, opening doors to international growth opportunities.
Expert Insights
“For India’s gaming sector, this is both a challenge and an opportunity. As companies reset their models, the winners will be those who innovate—whether in casual formats, eSports ecosystems, or global expansion,” said Mukesh Kumar, Associate Partner, Redseer Strategy Consultants.
The Road Ahead
While the next few years will test the resilience and agility of India’s gaming ecosystem, the fundamentals remain strong. With a massive gamer base, rising demand, and policy support for non-RMG categories, India is poised to script a new growth story in global gaming.
