India's Online Gambling Ban Drives Offshore Surge

⏳ 3 min read

India's sweeping ban on online real-money gaming, which came into force on 1 May 2026 under the Promotion and Regulation of Online Gaming Act 2025 (PROGA), is producing the opposite of its intended effect. Rather than curbing gambling participation, independent surveys show that offshore platform usage has surged by more than 20 percentage points since the prohibition took hold — with government enforcers having blocked over 8,376 gambling-related URLs as of 28 March 2026 and still losing ground.

The scale of the unintended migration is stark. A December 2025 CUTS International survey of 3,000 former domestic platform users across Delhi NCR, Tamil Nadu, and Maharashtra found that offshore participation rates hit 82%, 83%, and 92% in those states respectively — up from roughly 68% before the ban. Meanwhile, daily offshore sessions jumped from 3.4% to 42.3% of respondents, and the share spending over ₹10,000 per month on unlicensed foreign sites — a category that barely existed pre-ban — became a measurable segment almost overnight.

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What PROGA Actually Bans

PROGA, enacted by Parliament on 22 August 2025 and operationalised via Gazette notification on 22 April 2026, creates three game categories: permitted e-sports, permitted online social games, and absolutely prohibited online money games. The definition of an “online money game” is deliberately broad — any game where a player pays fees or deposits money in expectation of a monetary or equivalent return qualifies for the ban. There is no skill-based exemption, no licensing pathway, and no tolerance window.

The new Online Gaming Authority of India (OGAI) — a six-member, digital-first body under MeitY chaired by an Additional Secretary — holds powers to classify games, register permitted titles, and initiate enforcement proceedings. Fantasy sports giants, including Dream11, ceased real-money operations; CEO Harsh Jain confirmed the platform would pivot to free-to-play and esports formats following the prohibition.

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The Enforcement Picture

MeitY disclosed in a Lok Sabha response on 1 April 2026 that it had blocked 8,376 URLs linked to online betting and gambling, with more than 4,800 of those blocks coming after PROGA’s enactment. The ministry draws on the IT Act 2000, the Bharatiya Nyaya Sanhita 2023, and PROGA itself to issue blocking orders.

Criminal penalties under PROGA are severe on paper:

• Offering or facilitating payments for online money games: up to 3 years imprisonment and fines up to ₹1 crore
• Advertising prohibited games: up to 2 years imprisonment and fines up to ₹50 lakh
• Repeat offences carry mandatory minimum sentences

Banks, UPI providers, and payment gateways are legally barred from processing transactions for prohibited platforms, with personal criminal liability applying to compliance failures. Yet the UPI bypass routes — where users route payments through mule accounts and layered transaction systems — have thus far remained operational.

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The Offshore Surge in Numbers

The CUTS International survey published in March 2026 documented a pattern regulators have observed in other prohibitionist markets: demand is geographically displaced, not eliminated. Key findings:

• Offshore participation in Maharashtra rose by 25 percentage points, reaching 91.7%
• Daily access surged from 3.4% to 42.3% of surveyed users
• Users spending ₹5,000–₹9,999 per month on offshore sites rose from 7.6% to 26.2%
• The 18–24 age group showed the fastest relative growth in offshore spending
• Mirror domains and domestic UPI payment routing are the primary bypass mechanisms

Global operators are seeing the migration directly in their traffic data. Stake has reported that India accounts for over 13.4% of its total traffic, ranking India second only to Canada. Mirrored versions of 1xBet and Parimatch are attracting between 228,000 and 300,000 monthly Indian visits respectively.

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Operator and Payment Provider Exposure

For operators and their financial partners, PROGA’s reach extends beyond Indian-domiciled businesses. The legislation explicitly names country of origin as an assessment factor when OGAI classifies foreign platforms, raising the legal exposure for offshore services that continue targeting Indian users. Board members and executives face personal liability unless they can demonstrate documented due diligence and absence of knowledge.

Advertisers and influencers face equal exposure: the law prohibits both direct promotion and lifestyle content featuring prohibited gaming apps. A three-tier appeals process — service provider to OGAI within 30 days, then to the MeitY Secretary — provides procedural recourse, but proceedings are digital and penalties flow to the Consolidated Fund of India, creating no settlement pathway.

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The Market at Stake

The financial stakes sharpen the policy dilemma. Experts estimate the Indian offshore gambling market at approximately $20 billion annually, with tax evasion exceeding $4 billion per year — already surpassing domestic industry revenues from before the ban. A January 2026 CUTS survey in Tamil Nadu documented a 15.2% rise in offshore platform usage following the prohibition, consistent with the December 2025 Delhi NCR data.

Metric	Pre-Ban	Post-Ban
Offshore participation (Delhi NCR)	68.3%	82%
Offshore participation (Maharashtra)	~67%	91.7%
Daily offshore sessions	3.4%	42.3%
Sessions exceeding 2 hours	~3%	~44%
Monthly spend ₹5,000–₹9,999	7.6%	26.2%
Offshore gambling URLs blocked	~3,500	8,376

Every metric of engagement on unregulated, offshore platforms has moved in the wrong direction since the law took force. OGAI holds enforcement powers but has no jurisdiction over servers hosted abroad, and the UPI bypass routes remain open. Whether supplementary measures — VPN restrictions, crypto transaction monitoring, or ISP-level deep packet inspection — can bend the curve remains the central unanswered question for India’s 450 million-strong online gaming population.

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Sources

Primary sources are listed first. All URLs verified at time of publication.

Prohibition has merely reshaped the geography of gaming rather than eliminating it.

— Amol Kulkarni, Director of Research, CUTS International · Outlook Business, March 2026