Huge illegal market behind plan to regulate gambling

A huge underground betting market estimated at Rs 3 lakh crore and the growing popularity of online gaming are among the reasons cited by the Law Commission to support its recommendation to allow "regulated" gambling in sports.

The commission, chaired by retired Supreme Court judge Justice B S Chauhan, cited a KPMG study that estimated the current online gaming market at $360 million which was expected to rise to a billion dollars by 2021.

It also cited reports claiming that there were only 12 professional gaming teams in India in 2016 which increased to 30 in two years. The commission also cited a 2013 FICCI report that pegged the underground betting market in India at Rs 3 lakh crore and made a strong case for regulating it.

"Such activities show no signs of being stopped or curbed; the least that could be done is to regulate them," the commission said.

It noted that unregulated gambling and betting activities would lead to exponential growth of illegal trade and commerce, and corrupt practices such as spot-fixing and match-fixing being employed in sports, particularly cricket, the most popular sport in India.

"Left unregulated, this problem could further manifest and grow uncontrollably," the commission observed, and cited that between 2016 and May 5, 2018, the Delhi Police alone had registered 2,916 cases under the Gambling Act.

'Link them to Aadhaar'

The commission recommended linking transactions between gamblers and operators to Aadhaar and PAN cards for regulation purposes.

The linkage of such transactions to Aadhaar would restrain people from vulnerable sections, particularly those who are below poverty line and beneficiaries of government's welfare measures through their Jandhan accounts, the commission said.

Dissent note

One member of the four-member commission, however, disagreed with the report contending that the recommendations may lead to “unhealthy and unwarranted discussion”.

The dissent note submitted by Prof S Sivakumar was critical of the commission for exceeding the brief given to it by the Supreme Court in 2016.

According to Sivakumar, the apex court had told the commission to "consider legalising betting in cricket", and not sports betting in a general manner.

The commission has also recommended amending laws regulating foreign exchange and India's FDI policy to allow investments in casino and online gaming industry.

It said that allowing FDI in the industry would “bring substantial amounts of investment to those states that decide to permit casinos, propelling the growth of tourism and hospitality industries, while also enabling such states to generate higher revenue and employment opportunities."