Is Online Gambling Legal in India?
Online gambling laws are different all over the world, which can make it hard for players to see whether or not their favourite games are permitted. After all, the internet is open. People will usually find it easy to access whatever sites they wish if they are determined enough to do so.
In India, though, there is a lot of confusion over online gambling laws. Let's clear up everything that you need to know about online gambling laws in India.
To start, gambling was first prohibited in India under the Public Gambling Act of 1867. The act prohibits operating or visiting public gambling establishments, but it has no mention of online gambling. Gambling domestically across India as a whole is very restricted with this law, but lotteries and horse racing are legal across the majority of states in India.
The Federal Information Technology Act of 2011, was passed to restrict online gambling activities by holding internet service providers accountable for ensuring foreign betting sites are blocked. But, this law does not prohibit residents of India from accessing and using online and offshore gambling sites.
However, online gambling using offshore, legal and licensed operators are legal for players from India, but it is also not regulated yet. We have seen no reports of anyone being punished for online gambling, and hundreds of thousands of Indian gamblers play safely each year.
Overall, online gambling is still a grey area, essentially making it legal for Indian residents to gamble online using offshore casinos and bookmakers, that are legal and licensed in their territories. Offshore gambling sites (like the ones listed on BettingGuide) operate in this grey area where there is still no explicit law against online gambling for players from India.
Residents of India can gamble legally on betting sites such as bet365, Betway, and all of the gambling sites on BettingGuide, as they are offshore, legal and licensed. Compare our list of the best betting sites in India for 2020 that accept Indian players and deposits in Indian Rupees.
History of Online Gambling Laws in India
First up, it is useful to give some background about online gambling laws in India's background. Gambling rules in the country can be traced back to the Public Gambling Act of 1867. Initially, this law only applied to states under British rule, but it was later extended to all of India.
This legislation banned being in charge of a public gambling house. Those who break this law could face up to three months in prison, as well as a hefty fine.
However, much of the gambling that takes place in India now is illegal. It is thought that the Indian gambling industry is worth some US$60 billion per year, but about half of this is illegal.
Today's Online Gambling Laws in India
Both federal and state level have laws regarding gambling, which adds to a confusing picture. The Information Technology Act was introduced to ban certain online activities.
Goa, Daman, and Sikkim are three states that legalised land casinos in India while Sikkim and Nagaland have both legalised certain forms of online gambling. However, online gambling is completely prohibited in the state of Maharashtra.
In most other Indian states, there are no specific laws regarding online gambling, which makes it a legal grey area. It is neither legal or illegal to gamble online, but we have not seen any records of any Indian residents being prosecuted or charged for the offence of online gambling, and there are plenty of bookmakers offering gambling products for Indian customers. The law simply states that gambling providers may not operate on Indian territory unless expressly allowed by individual states.
But, almost all betting sites and online casinos are located outside of India, and it is completely legal and possible for Indian players to join and play. The Indian government is aware that millions of Indians currently engage in online gambling, but they have not made any laws to make it illegal.
How Does the Indian Government Stop Online Gambling?
The Indian government has the power to block people from accessing foreign websites. This is one of the main ways they control online gambling across the country. However, any Indian who is savvy on the internet will be able to find a way around this.
Many major online gambling sites are open to Indian users. They even make this clear by adding Indian currency to their list of payment methods that can be used on the site. These sites are hoping people from India will use them for online gambling.
Sikkim has taken a different approach to online gambling. A few years ago, Sikkim moved to issue a licence to Future Gaming Solutions Private Limited. This meant the company, an online gaming operator, was free to offer online casino games to Indians for the first time.
Using Indian Currency at Foreign Online Casinos
With no Indian online casinos available to use, lots of people will look overseas instead. While there is nothing technically standing in the way of an Indian using an overseas site for online gambling, one piece of legislation has to be mentioned here. This is the Foreign Exchange Management Act (FEMA), which was introduced back in 1999.
FEMA controls the exchange of foreign currencies. Playing at an online casino with a currency other than rupees could therefore lead to a breach of this law. One way to get around breaching FEMA rules is to use an online e-wallet such as Neteller or Skrill.
Differences Between Skill and Luck Games
One of the key things in India's gambling rules is the difference between skill and luck games. For example, poker is clearly a game of skill, even though there is significant luck involved. More often than not, a poker player with a lot of skill and experience will beat a bad one.
Blackjack is another casino game that involves skill. Players can affect whether they win or lose a game of blackjack by making decisions such as whether to stick or twist. However, online slots are obviously mostly about luck. It does not matter what the player does when playing online slots games, the outcome is out of their hands.
Sports betting is a combination of both skill and luck. While research and expertise can help to be successful in online sports betting, ultimately what happens in a game is unpredictable. Nevertheless, India's Supreme Court has ruled that horse racing betting is a skill. Fantasy sports are deemed to be a skill, which has helped Dream11 to become dominant.
The difference between skill and luck games is vital. This is as skill games are not covered by the Public Gambling Act, paving the way for them to be offered by online operators.
Will Online Gambling Changes Happen Soon in India?
Many countries are considering making changes to online gambling laws and the same could happen in India soon. There have been calls for India to finally introduce a comprehensive regulatory framework for gambling. Clarity would make it a lot easier for people to know what is and is not allowed. But COVID-19 means progress is likely to be slow on changing these rules and regulations.
Daily fantasy sports are likely to be an area of interest regarding changes to the law. While games such as those offered by Dream11 are usually classed as skill, this matter is set to be examined by India's Supreme Court. If the court was to rule fantasy sports games are a game of luck, this could shut down the industry entirely and have massive implications for the world of online gambling.
Regulating online gambling could have big benefits for India, such as that large amounts of money could be raised as a result of taxation. It has been estimated that tens of thousands of crores in revenue could be generated as a result of allowing online gambling. This could hasten such changes, but the process is likely to be time-consuming.