On the heels of the Tamil Nadu Government's ordinance to ban online games which involve real money, or Real Money Gaming (RMG), the E-gaming Federation (EGF) is set to challenge it as the former categorizes rummy and poker as games of chance.

Tamil Nadu’s move came in line with those of several other states including Andhra Pradesh, Arunachal Pradesh, Assam, Odisha and Telangana.

This is because, under the aegis of the Supreme Court and held to be protected under Article 19(1)(g) of the Indian Constitution, rummy has been settled as predominantly a game of skill. Bringing it under the ambit of a game of chance is directly in violation of the Supreme Court judgments and the Madras High Court judgment, which overturned the law banning online games including rummy and poker.

In a statement, Sameer Barde, CEO of EGF said, “After examining the ordinance, we have decided to file a lawsuit as it categorises Rummy and Poker as games of chance. This is in dissonance with multiple legal judicial pronouncements, including the recent judgment by the Madras High Court, which has clearly segregated games of skill and chance. The Supreme Court and several High Courts have reaffirmed the status of skill-based games as legitimate business activity and the state must take cognizance of these judgments in developing an enabling gaming policy that safeguards players rather than resorting to a ban.”

While some states have enacted blanket bans on various forms of online gaming and gambling, the industry argues that the former are ‘games of skill’, whether played online or on the ground, while the latter are online operations conducted by offshore firms. Ironically, some of the selfsame states also run state-sponsored lotteries, which are purely predicated on chance.

In a select media roundtable last week, Roland Landers, CEO, All India Gaming Federation (AIGF), spoke about how the gaming industry was collectively working with various union ministries including that of Electronics and Information Technology, Finance, Commerce, Sports, and other institutional stakeholders to come up with a regulatory body and bill to steer the course of an ever-expanding Indian gaming sector.

“When steps take arbitrary steps against the entire industry, this leads to people turning to illegal gaming and gambling sites, most of which are operated offshore, with people betting between Rs 50-75,000 crore per year on these illegal sites,” said Landers.

This in turn is hurting the existing Indian gaming industry, working within the confines of the law. Rohit Agarwal, Founder & Director of marketing agency Alpha Zegus elaborates that due to state-level conflicts, RMG brands have to be very careful about their marketing strategies, saying, “They can't work with influencers from certain regions, they can't have players join in, and they can't run any form of ads in those regions. However, RMG brands then shift their focus from trying to increase their user base, to increasing the spending from the current user base.” 

The Indian gaming market is expected to grow from the current  $2.2 billion (over Rs 18000 crore to USD 7 billion (close to Rs 58000 crore approximately) by 2026. Growing at an impressive CAGR of 38%, the sector holds significant potential for overall economic growth and employment opportunities.

Agarwal concludes, “RMG as a segment works by tapping into the human desire of making more money - which has, and will exist, no matter any bans. These platforms know that, and so do the investors. They will continue to scale up despite the bans and keep creating more lucrative options for the audience to spend more (to earn more).”