Indian Gaming Sector To Hit $60 Billion Mark In Ten Years From Now: USISPF Report

United States contributes $1.7 billion of the total $2.5 billion in foreign direct investment (FDI) into India’s gaming market, underscoring the country's growing appeal as a global gaming hub.

India’s online gaming industry, currently valued at $3.1 billion, is poised for explosive growth, with the potential to reach $60 billion by 2034, despite ongoing challenges related to regulation and taxation, according to a report released on Monday. The report highlighted the significant role of foreign investment in the sector, with the United States contributing $1.7 billion of the total $2.5 billion in foreign direct investment (FDI) into India’s gaming market, underscoring the country's growing appeal as a global gaming hub.

Interestingly, 90 per cent of this foreign direct investment is concentrated in the pay-to-play segment, which represents 85 per cent of the industry's total valuation.

Dr Mukesh Aghi, president and CEO , United States India Strategic Partnership Forum (USISPF), said, “This reflects the immense confidence global investors have in India’s rapidly growing gaming market, which is projected to become a $60 billion opportunity by 2034.”

Parth Chadha, CEO & Co-Founder, Stan, said, "The Indian online gaming industry is on the verge of monumental transformation and has the potential to grow from $3.1 billion to $60 billion in 2034 as stated by the US ISPF-TMT report. Despite challenges like regulation and taxation, the influx of foreign investment—$1.7 billion out of $2.5 billion in FDI from the US alone—underscores the growing confidence in the future of the gaming industry of India that was considered as a mere timepass for people, so we have seen a massive evolution in the gaming sector."

Challenges For Indian Gaming Industry

According to the report by USISPF and TMT Law Practice, India is notable for its steep tax rate, applying a 28 per cent Goods and Services Tax (GST) across all gaming formats based on total player deposits. The report also emphasised that the United Nations Central Product Classification (UN CPC), which serves as the foundation for taxation in many countries, distinguishes between online gaming and online gambling.

Aghi said, “With a large consumer base of over 600 million gamers, this space is rapidly being monetised and presents a substantial export opportunity. However, for Indian companies to compete on a global stage, we need a level playing field with progressive tax and regulatory policies that align with international standards.”

The report analysed the regulatory and taxation structures across 12 major gaming markets, highlighting that each of these countries has established a distinct legal definition for games of chance, clearly separating them from skill-based gaming formats. It stressed the importance of using platform revenue or the commission collected as the tax base.

This approach not only ensures a more equitable tax system but also helps prevent the rise of illegal offshore markets, which often operate untaxed and unregulated, posing a threat to both the industry’s stability and government tax revenues.