Syllabus: GS3/Security
Context
- According to a report by CUTS International, India has emerged as a major hub for illegal online betting, with unauthorized gambling platforms recording over 5 billion visits in FY25.
| Consumer Unity and Trust Society (CUTS) International – It is a non-profit, non-governmental organization dedicated to promoting social justice and economic equity across borders. – It was established in 1983 in India, and has expanded its operations globally, with advocacy centers and resource hubs in countries like Zambia, Kenya, the UK, and Vietnam. |
Key Findings of the Report
- Massive User Engagement: The top 15 illegal betting platforms, including 1xBet, Parimatch, Stake, Fairplay, and BateryBet, collectively logged over 5.4 billion visits in FY25.
- Financial Scale: Annual deposits on these platforms are estimated to be around $100 billion, raising concerns about money laundering and tax evasion.
- Regulatory Loopholes: Many of these platforms bypass KYC and age verification, exposing minors to gambling risks.
- Advertising & Payment Issues: Offshore operators exploit India’s advertising and payment infrastructure, making it easier for users to access these sites.
About Online Gambling / Betting in India
- Online gambling refers to the practice of participating in gambling activities over the internet.
- It involves placing bets or wagers on various games and events with the aim of winning money or other prizes.
- Online betting platforms in India continue to operate, often through offshore entities.
Key Concerns
- Money Laundering & Fraud: Reports indicate that online gambling platforms are being used for money laundering and terror financing, prompting calls for stricter oversight.
- Addiction & Mental Health Issues: The rise of real-money gaming has led to concerns about gambling addiction, with cases of financial distress and mental health struggles among users.
- Jurisdictional Issues: The cross-border nature of online betting complicates enforcement, as many platforms operate from jurisdictions beyond Indian authorities’ reach.
- Misleading Advertisements: High-profile endorsements of betting platforms contribute to their widespread appeal.
- The Advertising Standards Council of India (ASCI) flagged hundreds of offshore betting ads, highlighting the need for stricter advertising regulations.
Legal Framework in India
- Public Gambling Act, 1867: This central law prohibits gambling in most parts of India but does not explicitly address online betting.
- State-Specific Laws: States like Goa, Sikkim, and Nagaland have legalized certain forms of gambling, including online betting, under regulated conditions.
- Supreme Court & High Court Rulings: Courts have distinguished between games of skill and games of chance, allowing skill-based gaming platforms like fantasy sports while restricting pure gambling sites.
- Information Technology Act, 2011: It was amended to include provisions related to online gambling which states that any website that offers online gambling services must be located outside of India.
- Consumer Protection: The Central Consumer Protection Authority (CCPA) has issued advisories warning against the promotion of illegal betting platforms.
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