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Game Over for Online Gamblers in India’s Andhra Pradesh?

Article by : Helen Sep 11, 2020

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Updated: Aug 10, 2022

On September 3, the government of the Indian state Andhra Pradesh has decided to amend its 1974 Gaming Act to crack down on online gambling activities, including such games as poker and rummy.

The amended Andhra Pradesh Gaming Act, 1974, will focus on decreasing the demand for online gambling by sentencing those who gamble to 6 months of imprisonment (which can increase up to 2 years in case of a repeat offense). It will also allow for persecuting those suspected in organizing online gambling, with the punishment for this offense set to be one year in prison (in case of a repeat offense – up to 2 years and a fine).

While it is being described as a ban on online gambling by both news outlets and state officials, the changes in this law won’t grant the state the right to block any apps or websites that operate outside of Andhra Pradesh. According to Kumar Vishwajeet, the AP home department’s principal secretary, there is no intent to go after the apps and websites themselves and try to block them. Notably, earlier this month, India banned 118 apps tied to China that reportedly were “hostile to national security.” The decision to crack down on online gaming was motivated by concerns about the well-being of young residents of the state, and the effect gambling may have on citizens’ financial situation.

We have decided to ban such online gambling to protect the youth.

In 2016, the state of Andhra Pradesh was seen as potentially fertile ground by casino operators, including a US company NRI. That year, the state government received seven different proposals for setting up casinos. As of now, casino operators are yet to see a positive decision from the state’s officials.

Under the Indian Constitution, the legal status of gambling is in the hands of the states’ legislatures, i.e., each state has the right to decide whether or not to deem it illegal, along with what restrictions to put in place. Most states keep their restrictions on gambling heavy. It is worth noting that there is a clear distinction between the two types of games in the Indian legal framework: games of chance and those of skill. Playing games of skills is not considered gambling, as a general rule.

In 2014, the Supreme Court of India reached out to the federal government with an official request to clarify their position on the legality of gambling in general. It declined to take a stand and emphasized that this matter falls under the jurisdiction of the states – and it should remain this way.

Up to this day, only three states are not as restrictive as their counterparts: casinos are allowed to operate in Goa, Daman, and Sikkim. At the same time, casinos in these states are forbidden to promote any online gambling activities, including on any of their websites.

Despite this highly restrictive environment, the Indian shadow gambling market is estimated to be worth $150 billion in bets placed illegally, as it is highlighted in a study done by the International Center for Sports Security. Those who criticize the crackdown on online and in-person gambling point out that easing down the current policies can be beneficial for the state governments, too. Should gambling become legal, the state budgets will be able to receive tremendous additional income in the form of taxes imposed on gambling operators.

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