Every gamer knows the thrill of New Game+: the moment you restart with better gear, sharper skills, more experience and a clearer map. That is precisely where India’s online gaming industry finds itself today. With 8.45 billion mobile game installs in FY 2024-25 and a gamer base of more than 488 million, India is already the world’s largest mobile games market by far. Yet, a fragmented and uncertain policy environment left the industry navigating a regulatory grey zone. The Promotion and Regulation of Online Gaming Act 2025 (“PROGA”) and the Promotion and Regulation of Online Gaming Rules 2026 (“Rules”), both effective 1 May 2026, change that decisively. 

What has changed for online gaming in India since August?

The Indian real-money gaming (“RMG”) industry, a significant contributor to the ‘Digital India’ story, faced a completely unexpected blanket prohibition in August 2025 when the PROGA was enacted. Although this was not brought into force immediately, the domestic RMG industry decided to comply nonetheless and ceased operations. Subsequently, in October 2025, draft Rules were released, and after consultations with RMG market leaders, esports organisers and financial intermediaries, the Central Government on 22 April 2026 finally announced the operationalisation of the PROGA framework. This came alongside its new Rules from 1 May 2026, also setting 
up the new Online Gaming Authority of India (“Authority”).

The new framework 

PROGA identifies three categories for online games: ‘online money games’ (money-in and money-out) which are prohibited; and ‘online social games’ (colloquially known as casual games) and ‘esports’ – both of which are permitted and promoted. Online money games, by contrast, are now prohibited, along with their advertising and payment facilitation. The Authority is empowered to ‘determine’ the nature of online games (to check whether they are online money games), issue directions and codes of practice, adjudicate user grievances and coordinate with financial institutions and law enforcement. 

By default, no online game requires determination or registration with the Authority. ‘Determination’ is triggered only in limited circumstances: a suo motu direction by the Authority; an intent to offer a game as an esport; or a Central Government notification mandating determination for a category of online social games. Similarly, ‘Registration’ is mandatory only where the Central Government specifically notifies a game or a category, or where the online game is to be offered as an esport. The factors the Central Government can consider when mandating registration include risk of harm to users (including children), scale of user participation, nature or value of financial transactions, and — of particular relevance to foreign operators — the country of origin or head office of the service provider. Certificates of Registration are valid for up to 10 years, doubled from the five years originally proposed, a welcome sign of regulatory stability. 

Online social games can monetise through one-time access fees, subscription fees or advertisement revenues, as long as there is no wagering/staking involved. For esports, PROGA formally distinguishes esports from online money gaming and links it to organised sports governance. This separation gives players, organisers and sponsors a much clearer legal basis to engage with the sector.

Moreover, the overall structure of PROGA arguably suggests that, as long as a game does not fall within the definition of an “online money game,” it is likely to remain permissible to operate in India – irrespective of whether it squarely falls within the other two categories or not. On the business side, and for investors, the numbers do the talking. Reliable industry estimates project the wider gaming market to grow from $3.8bn in FY24 to $9.2bn by FY29, with 44% of gamers being women and 66% being from non-metro cities.

What you must Do from 1 May 2026

If you are offering online money games to users in India, stop immediately – the PROGA is a criminal law and has extra-territorial effect. If you are offering online social games, no immediate changes are required if your format is clearly distinguishable from an online money game and can withstand regulatory scrutiny. Banks, payment processors, advertisers and influencers should ensure the games they facilitate/promote are not online money games. 

If you intend to offer esports, take a step back. Not all esports, as globally understood, will qualify under PROGA. The definition requires that the esport first be recognised under a separate law (that framework is still being operationalised). In the meantime, if your esports offering involves taking money and awarding prizes, pause those elements until the recognition process crystallises.

PROGA is not a final goalpost but the beginning of a regulatory journey. For entrepreneurs, investors and foreign companies, it offers what this market has long lacked: a centralised, structured regime that treats online games as legitimate digital products and creates a credible pathway to formal legitimacy.