PremiumIndia’s draft IT regulations for gaming are too strict in parts but welcome in asking for self regulation. Given its risks, this industry can’t expect a free run. Or a single code for all states
For an industry that has been growing at break-neck speed but can pose public risks, the draft proposals brought out by India’s ministry of electronics and information technology to regulate online gaming under IT rules are largely welcome. Our broad aim should be to ensure that this sprawling industry flourishes within a well-defined framework of rules, with online gamers exposed only minimally to harm. Gaming can be an addiction, just like gambling, or perhaps even alcohol, given the mind buzz created by its wave patterns of stimulus and reward. The draft defines an online game as one that’s “offered on the internet and is accessible by a user through a computer resource if he makes a deposit with the expectation of earning winnings". Its insistence on know-your-customer records is much too stiff, as games do not resemble banks in their ID-proof needs, but its call for a self-regulatory organization to be set up must be met without delay. As proposed, its board must comprise members from diverse fields such as public policy, infotech, medicine and psychology, apart from online gaming itself, and should screen games for anything that compromises India’s internal security or external relations, or could cause offence and incite trouble, among other worries.
Having set a blistering pace of growth in the past half decade, India’s gaming industry is now eyeing a pie worth $8.6 billion by 2026-27. With new rules laid out, it would do well not just to comply with grievance and compliance norms, but also watch itself so that it does not stray into zones that rake up basic questions of legitimacy. Digital games, after all, can be of any sort. “The rules are very simple, online gaming betting and gaming betting advertisements have been brought under prohibition," said Rajeev Chandrasekhar, minister of state for electronics and information technology. “Any online game that permits wagering as an outcome is effectively a no-go area." While that may sound clear enough, a big grey area exists in what constitutes a game of skill, as opposed to one of chance, which could determine whether it is legal. As money that’s bet on a fully random result is a pure gamble, it tends to attract laws that differ from one state to the next. Also, since the division of roles played by skill and luck in a game can be blurry, slotting them is difficult. In the digital realm, distinctions can be even harder to make without peering into the math formulae behind the facades. An online platform offering wins may turn out to be a simple jackpot spinner in the guise of a skill rewarder.
For an internet gaming company, India’s state-level thicket of rules on gambling can be exasperating. Gaming lobbies had hoped for single-market regulation under an all-India legal code. This would have eased business, no doubt, but remains impractical in a federal set-up like ours. At this point in this market’s evolution, it may not even be a good idea. Not only can gaming in some cases be addictive, its age-gate protocols are relevant, given its appeal among the youth. Its social impact and efficacy of rules need to be studied. Together with a big betting riddle that tech has made harder to solve, this makes a case for policy tests before we can judge what works. States going their separate ways could yield comparative lessons on how best to foster this industry’s success within public-safety limits. While light-touch regulation is usually all that’s needed, a peculiar mix of vulnerabilities warrants special caution in this market. Nobody should get to game it.