Online gaming and gambling — a debt-and-death trap for rural youth

India has around 420 million active online gamers and the industry is slated to grow to five billion dollars by 2025. The number of children who are addicted to gaming for stakes and online gambling is increasing and many of them are dying by suicide as they lose money online. The central law that governs gambling was enacted way back in 1867 and is toothless.

Brijendra DubeyBrijendra Dubey   2 Dec 2022 5:34 AM GMT

Online gaming and gambling — a debt-and-death trap for rural youth

It is not just children, even young adults are taking their own lives after losing money in online gambling and online gaming for stakes. 

Chhattarpur (Madhya Pradesh) and Mirzapur (Uttar Pradesh)

Last year, on August 2, when Preeti Pandey left for work after having breakfast with her son, little did she know it was going to be the darkest day of her life.

"He came with me up to the gate, and said 'Bye' to me. There was nothing in his demeanour to suggest he was disturbed," Preeti who lives in Chattarpur in Madhya Pradesh, told Gaon Connection.

That day, her 12-year-old son died by suicide.

The boy's father, Vivek Pandey, said that his son had fallen prey to an online shooting game called 'Free Fire' which is played on a mobile phone and requires money transaction. "I found out that he had spent Rs 40,000 from his mother's bank account for an online betting transaction for a game," he told Gaon Connection.


"I wish such online games would be banned completely," said Vivek who struggled to even file an FIR after his son's death. "I learnt how the government has no mechanism to control digital gambling. Even registering an FIR [first information report] wasn't easy. I had to mobilise the support of a lot of influential people to do so," he said.

Lokendra Singh, the Chief Superintendent of Police in Chhatarpur district told Gaon Connection that an FIR was lodged against the manager of the Free Fire gaming application on the charges of abetment to suicide. But, more than a year later, the case has not progressed at all, the father complained.

India has around 420 million active online gamers and the industry is slated to grow to five billion dollars by 2025.

Also Read: Smartphone addiction leading to health disorders in rural India

India has around 420 million active online gamers and the Indian online gaming sector is growing at nearly 30 per cent annually. This industry is slated to grow to five billion dollars by 2025.

Gambling is illegal in India but online gaming for stakes remains a grey area. Internet gambling and online gaming, such as Free Fire, Rummy, Roulette, Black Jack, and Indian Flash, have ensnared hundreds of thousands of children, say the concerned families of children.

As the internet and smartphones penetrate deeper into the villages of India, a large number of rural youth are falling prey to these virtual games that have almost nil regulation. And an alarming number of them are dying by suicide.

"The internet penetration in the countryside is unprecedented but there is absolutely no awareness amongst the rural residents about the potential risks of online gaming and gambling. The unaware villagers are easy targets for such online games. The social impact of gambling especially amongst the younger people is distressing," former Member of Legislative Assembly from Uttar Pradesh's Mirzapur Lalitesh Pati Triptathi told Gaon Connection.

For now, the billion-dollar industry remains unregulated and the ordinary citizen is paying the price for it.

He isn't wrong. In July this year, a 22-year-old from Manpur village in Kendrapara, Odisha, took his own life after losing money in online gaming. Two months later, in September, a 21-year old engineering student in Vapi, Gujarat killed himself after losing money in online gambling.

Shockingly, in January this year, an 11-year-old died by suicide in Bhopal, Madhya Pradesh, after losing money to online gaming.

"There has been a rampant rise in the cases of online gaming and gambling addiction. It is a compulsive disorder in which the patient feels intense cravings despite repeated loss of money," Pooja Singh, a clinical psychologist at Mirzapur District Hospital in Uttar Pradesh, told Gaon Connection.

There is no clear legal differentiation between online gambling and online gaming (for stakes). Promoters of the latter call it entertainment and not gambling as it comes under 'the games of skill' and not chance, they say.

But those who have lost huge amounts of money have been driven to suicide. It is a frightening situation.

Getting addicted to online gaming is not necessarily a long drawn out process. Retribution is often swift, as Pawan Ahirwal from Vidisha in Madhya Pradesh, found out, tragically. His younger brother, 20-year-old Aman Ahirwal, died by suicide on September 4 this year, within a week of taking to gambling online.

"He got a new phone last year and only recently began playing teen patti online. He had borrowed almost Rs 50,000 from relatives and friends. He lost about Rs 40,000 in gambling. After almost a week of playing this game, he killed himself," Pawan Ahirwal, told Gaon Connection.

Distraught parents and family members have nowhere to turn to, and they do not know how to seek justice or find closure as there is no comprehensive legislation to control or monitor these digital platforms.

Billion dollars industry but no regulation

In India, the archaic Public Gambling Act, 1867, governs penalties for "public gambling". So, most of the online gaming portals which involve an element of betting or gambling, promote their product as a game of skill rather than a game of chance.

This online gambling vs gaming debate has led to the Directorate General of GST Intelligence (DGGI) issuing the biggest show cause notice of Rs 21,000 crore in the history of indirect taxation to a Bengaluru-based online gaming company, Gameskraft Technology Private Ltd (GTPL). The latter has already challenged the notice in the Karnataka High Court.

There is a two-tier rate structure for online gaming — 18 per cent in case of game of skill and 28 per cent in case of game of chance. Most online gaming companies levy GST (Goods and Services Tax) at 18 per cent, claiming it is a game of skill.

However, the DGGI feels that it is a game of chance. So, 28 per cent GST needs to be levied. This matter has been subjected to various writs and remains embroiled in legal controversies.

Meanwhile, the 1867 act remains toothless in dealing with online gambling and gaming for stakes.

"Although Section 13 of the Public Gambling Act, 1867 is applicable to such crimes [online gaming for stakes], it is not very effective in curbing online gambling and gaming," Narayanji Upadhyay, a Mirzapur-based lawyer, told Gaon Connection.

Echoing Upadhyay's comments, Manish Tripathi, another lawyer from Mirzapur mentioned that the law in place to check gambling (Public Gambling Act, 1867) is too outdated and has a maximum punishment of Rs 600 and an imprisonment up to a year.

"The youth is getting hooked to online gambling and the law we have to prevent such anti-social practices is way too old to make a dent in the multi-billion gaming and gambling industry in this country," Tripathi told Gaon Connection.

Last December, Member of Parliament (MP) Sushil Kumar Modi from the Bharatiya Janata Party, while introducing the topic on the need to legislate in order to regulate the online gaming industry in India, admitted that online gaming has surfaced as a 'big addiction' and demanded it needed to be regulated.

"Online gaming is becoming a big addiction. I would like to highlight that this sector, like the crypto industry, has regulatory lacunae. I would urge the government to bring a uniform tax on online gaming. I urge the government to make a comprehensive framework of regulation for online gaming," Modi said in Rajya Sabha on December 3, 2021.

Also, on April 1, this year, Congress MP Dean Kuriakose introduced the Online Gaming (Regulation) Bill, 2022, to 'establish an effective regime to regulate online gaming industry to prevent fraud and misuse and for matters connected therewith or incidental thereto'.

The addict has to be helped to rediscover interest and happiness in everyday activities such as reading, playing or watching movies, once again.

The Bill mentioned that India has around 420 million active online gamers and the industry is slated to grow to five billion dollars by 2025.

An inter-ministerial task force set up to explore new regulations for online gaming has recently recommended central legislation to govern it, calling the Public Gambling Act of 1867, which currently covers it, incapable "of covering/ defending/dealing" with digital-based activities and the emerging technologies associated with it.

It is also proposed to set up a central regulatory body for the sector, clearly defining what games of skill and chance are, and bringing online gaming under the purview of the Prevention of Money Laundering Act, 2002, among other things.

But, for now, the billion-dollar industry remains unregulated and the ordinary citizen is paying the price for it.

Online gambling and a trail of death

It is not just children, even young adults are taking their own lives after losing money in online gambling and online gaming for stakes. A quick Google search on the topic throws up several such news reports. In October this year, a 21-year-old engineering student in East Godavari district of Andhra Pradesh died by suicide after incurring a loss of Rs 80,000 in online gaming.

The same month a 26-year-old allegedly died by suicide after falling into a debt trap due to online gambling at Malakpalli village in Hanamkonda district of Telangana. In June this year, came another shocking incident of a 29-year-old mother of two toddlers dying by suicide in Chennai, Tamil Nadu. She reportedly lost Rs 10 lakh in online rummy.

Dharmapuri in Tamil Nadu was in the news in May this year when a 20-year-old NEET aspirant took his own life after losing money in online gambling.

In February, a 25-year-old student killed himself in Indore because "he had taken a loan to play some online games that offered prize money. But he kept on losing money in these games and failed to repay the loan."

All these cases of death by suicide are just the tip of the iceberg of addiction and debt trap due to online gaming, a fast-growing sector that remains unregulated despite the huge human cost.


States enact their own laws, but…

At present, India has just one central law of 1867 that governs gambling in all its forms. Gambling is largely a state subject in the country.

Tamil Nadu: In October this year, the Tamil Nadu Assembly passed a Bill moved by Chief Minister M.K. Stalin to prohibit online gambling and to regulate online games in the state. The government had established a committee under former Madras High Court judge K Chandru to investigate the rise in suicides. In June 2022, the committee had recommended banning online games.

However, due to a delay in the Governor's assent, the Bill expired. The Tamil Nadu Prohibition of Online Gambling and Regulation of Online Games Ordinance, 2022 was promulgated on October 3, 2022 to prohibit online gambling and online games of chance played for stakes.

Telangana: The state of Telangana banned all forms of gambling, including online gambling, in 2017. It enacted the Telangana Gaming (Amendment) Act, 2017 for the same. But, as per news reports, the state government is considering rethinking the ban as the gaming industry could contribute to the state's economy and could be an important source of employment.

Karnataka: Last year, Karnataka introduced changes in the Karnataka Police Act that deals with online gambling and banned all forms of gambling in the state, including online gambling, in order to "curb menace of gaming through the Internet, mobile apps".

However, in February this year, the Karnataka High Court struck down the law that banned online gaming. The next month, in March, the state government moved the Supreme Court of India. The apex court on September 16 issued notices to skill-based gaming companies and industry bodies on the Karnataka government plea.

The Supreme Court bench has also clubbed the matter along with a similar case filed by the Tamil Nadu government against a Madras High Court judgement.

Among the respondents are skill-gaming industry body All India Gaming Federation, self-regulatory fantasy sports industry body Federation of Indian Fantasy Sports, gaming firms Mobile Premier League , Games24x7, Head Digital Works, Junglee Games, and Gameskraft.

Kerala: Upon realising the rising popularity of online games like Rummy, on February 23, last year, the Kerala government issued a notification stating that "online rummy when played for stakes" would not be exempt from the provisions of the Kerala Gaming Act, 1960 which regulates gaming which is chance-based and not skill-based.

However, on September 27, 2021, the Kerala High Court overturned the Notification, and held that since rummy has already been found to be a game of skill by the Supreme Court, it is natural that it will enjoy the exemptions under the purview of the Kerala Gaming Act, 1960.

Some other states have also enacted their own laws but experts point out the need for a comprehensive and stringent central legislation to regulate the sector.

Also Read: Mobile-addict kids: It's a ticking time bomb

A serious addiction

Online gambling and gaming addiction has come to assume frightening proportions, said Pooja Singh, a clinical psychologist at Mirzapur District Hospital in Uttar Pradesh. It is no different from substance abuse, she pointed out.

Singh said that a classical symptom of such an addiction is fading interest in playing, studying, social interaction and hobbies.

"Other than substance abuse, addiction can also be caused by the brain's response to certain activities. The hormones dopamine and serotonin are hugely responsible for gambling addiction. And, as online gambling only requires a mobile phone and an internet connection, it is easy to access, and quick to become addictive," she said.

As the internet and smartphones penetrate deeper into the villages of India, a large number of rural youth are falling prey to these virtual games that have almost nil regulation.

Vijay Nath Mishra, a neurologist working at Sir Sunderlal Hospital in Varanasi told Gaon Connection that a person dealing with addiction is treated with cognitive behavioural therapy but the chances of a relapse are high.

"Such persons, especially children cannot be reprimanded for gambling and be expected to quit it. It's a lot more complicated. The family members and peers have to be very supportive during treatment," Mishra said.

"Despite the best of the efforts, the relapse rate is very high for such patients. Almost 53 per cent of such patients revert to gambling later in life or even immediately after completion of therapy," the neurologist added.

According to clinical psychologist Singh, early intervention is the best way to control the addiction. The addict has to be helped to rediscover interest and happiness in everyday activities such as reading, playing or watching movies, once again. But, the whole family had to be involved in the process of de-addicting the patient, she said.

If you are struggling with mental health issues and seek support or help, please contact 9152987821.

Written by Pratyaksh Srivastava. With inputs from Satish Malviya, Vidisha, Madhya Pradesh.

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