The Skill Online Games Institute (SOGI), an institution meant to provide knowledge and data-driven insights into the online games industry, held at event here today with its founder president, Amrit Kiran Singh, in attendance.
SOGI advocates for balanced regulation and collaboration to foster the growth of India’s online games industry in Meghalaya today. Through this, SOGI aims to focus on growth, innovation and education in the online games sector, tapping into the region’s potential and encouraging local talent to thrive in this hyper-digital industry, a press release said.
SOGI highlighted the meeting the Prime Minister held recently with gamers where he said that the government needs to understand the online gaming industry and make necessary changes to support its growth. This vision aligns with the broader goal of positioning India as a global hub for digital entertainment, including online gaming.
According to a recent report, the global gaming industry surpassed $300 billion in 2021, outstripping the combined markets of the movies and music industries by over three times. In India, the sector witnessed an impressive compound annual growth rate (CAGR) of 28 percent between FY20 and FY23 and the online games industry in India reached a market valuation of Rs 16,000 crore in FY23, with projections to more than double by 2029, the release said. The sector has been a major contributor to job creation, technological innovation, and foreign investments, attracting nearly Rs 23,000 crore in investments over the past five years and producing three unicorns led by Indian entrepreneurs, it added.
However, India is still a small player globally as it contributes a mere 1.1 percent to worldwide online gaming revenue, compared to China’s 25 percent and the USA’s 23 percent.
“This disparity indicates a substantial untapped potential within the Indian market, which, if harnessed correctly, could elevate India’s status in the global gaming industry,” SOGI said.
“While we celebrate the rapid expansion and the immense potential of the online gaming industry in India, we must also address the hurdles that come with it,” Singh said. “The 28 percent GST regulation poses a substantial challenge, impacting the overall profitability and investment in the sector. This will not only stifle the industry’s potential, leading to missed opportunities for economic growth and job creation, but also lead to more offshore illegal fly-by-night operators. We must work collaboratively with the government to find a balanced approach that supports growth while ensuring fair taxation.”
This increase in GST not only puts Indian companies at a huge disadvantage against international competitors but also offers the big Indian market of 300 million players to illegal international companies who advertise in India, luring players to come to their platforms and win without paying taxes. This also has huge PMLA (Prevention of Money Laundering Act) implications.
Singh believes that the challenges of the online games industry, particularly the risk of addiction and concerns under the PMLA, can be mitigated using technology.
“Technological solutions can be employed to ‘time out’ players who overindulge and to prevent money laundering. These concrete actions demonstrate the industry’s potential to address its challenges effectively. An Indian Council of Medical Research (ICMR) funded study by AIIMS researchers has shown that gaming disorder can be prevented through digital interventions,” he added.
