Ladies and gentlemen, across our great nation, there is consensus on one small thing that whenever there is an auspicious occasion, be it a marriage in the family or the birth of a child, there is always a hundred rupee note which is given with a one rupee coin. And the journey that SKOCH Group has seen across 100 summits today it is seeing the Shagun in the 101st SKOCH Summit. So it's an auspicious day. I must say I've seen the entire SKOCH family come up since 1997 and work hard to make this day a reality. So many congratulations to all of you for being a part of this journey and thank you very much.

A very warm welcome to the Honorable Ministers, Honorable Justices, India's leading economists, constitutional law experts, distinguished public service leaders, captains of industry, doyens of your respective domain, as the saying goes. If I have seen further, it is by standing on the shoulders of giants. And I humbly salute those amongst us and those who will be joining us through the course of the day. Thank you very much for your kind presence this morning from the length and breadth of the this great nation at the 101st SKOCH Summit in New Delhi.

SKOCH has been at the forefront of nudging government to regulate online gaming in a way that balances innovation with social responsibility, always working towards the betterment of all stakeholders. Over the past several years it has engaged in a wide range of actors. State governments, regulators, medical experts at AIIMS, legal scholarship, industry leaders to build consensus on a regulatory framework that is constitutionally sound, socially ethical and economically viable.

Backed by empirical compliance studies and continuous dialogue with policymakers across several states, SKOCH's work has helped shift the regulatory conversation from fragmented debates to a comprehensive, evidence-based and stakeholder-driven approach that promotes responsible growth for India's gaming ecosystem. SKOCH has also come up with a comprehensive discussion framework on regulating gaming. Against this backdrop, the government should see SKOCH as an important stakeholder in the gaming-related legal landscape changes.

The Promotion and Regulation of Online Gaming Act 2025 is indeed a landmark initiative being the first national statute to address this sector and because of its dual qualities of being a novel and an ambitious initiative. It is all the more important that its implementation is robust, fair and constitutionally sound. This lecture therefore is titled Towards Responsible Regulation of Online Gaming in India.

The Honorable Prime Minister has rightly flagged that the mental harm caused by certain forms of online gaming, while welcoming the Online Gaming Act as a step that safeguards society even as it boosts India's esports ecosystem. SKOCH has addressed this very concern in its recent discussion paper which highlights how exploitative mechanics such as loot boxes, microtransactions and gambling-style incentives aggravate risks of addiction, psychological harm, especially in a country with limited mental health care infrastructure.

The paper situates gaming within the broader domain of Internet-related psychopathology and proposes the Responsible Digital Gaming Framework to ensure that innovation and esports goes hand in hand with protecting mental health and consumer well-being. A balanced regulatory framework, ladies and gentlemen, is therefore not just economically prudent but also socially responsible.

At present the Act’s design prohibiting all online money games without distinction of design, purpose or harm profile risks transforming what was intended as a regulatory framework into a prohibitionist instrument. And such an approach, particularly bereft of stakeholder inputs, we respectfully submit, carries risks that are economic, social and constitutional. And our humble submissions are not offered in the spirit of criticism but in the spirit of constructive feedback. And we believe that by approaching implementation with balance, consultation and humility, we can ensure that the Act becomes a framework that protects consumers, supports innovation and respects our constitutional traditions.

We had the privilege of listening to Professor R. Kavita Rao who said the tax-to-GDP ratio of states has been steadily increasing and the Center's trends have been slightly more volatile. The Union's tax-to-GDP ratio, if we look at it in the sense of a sum of its parts, the direct tax has been increasing and the indirect tax has been decreasing. India today has more than 500 million online gamers. The sector, if proportionately regulated, could contribute over 20,000 crores annually in GST and income taxes.

The concern we humbly raise is that prohibition may unintentionally divert this activity offshore where neither revenues nor consumer protections are available to Indian citizens, and we recognize the government's broader ambition of positioning India as a global digital hub. To make this a reality, we suggest that regulation rather than prohibition is more consistent with fostering investor confidence and encouraging innovation across adjacent sectors such as fintech, education and advertising technology.

A prohibition-first approach sends a chilling signal to innovators and investors, deters capital inflows, and may threaten to hollow out adjacent sectors such as gamified education. International experience demonstrates that demand does not vanish with prohibition it migrates into informal and offshore spaces where enforcement becomes near impossible.

These were the economic considerations, ladies and gentlemen, if you look at the social and public health risks, the social harms of compulsive play and addiction are real and we acknowledge the government's duty to address them. At the same time, we respectfully submit that regulation provides more effective tools than prohibition—visibility of platforms, parental control, spending caps, grievance redressal and independent audits being some of them. If the activity does shift underground, these safeguards are lost and regulators are left without levers for intervention. A balanced regulatory model therefore serves both economic and public health objectives.

We had the privilege of listening to Dr. M. Ramachandran today who said the democratic federal structure should function in a proper way and if we are to discuss the constitutional safeguards on constitutional design, we humbly request that care be taken to preserve the balance between Union and State powers. Matters of betting and gambling fall under the State List, while the Center may rely on Entry 31 for communication. Such an interpretation, if taken too far, could appear to encroach upon state competence.

We also respectfully note that a blanket prohibition may face difficulty under the proportionality test of Article 19(1)(g) as recognized in Modern Dental College and the Puttaswamy judgment when less restrictive alternatives such as licensing and oversight are readily available. We raise these points to ensure that the Act, once implemented, is robust and capable of withstanding judicial scrutiny and is able to effectively curb the harms with gaming rather than simply driving them underground and and rendering them invisible.

Our policy suggestions, ladies and gentlemen, are as follows. On subordinate rulemaking the Act leaves several technical details such as classification of permissible formats, due diligence obligations, consumer safeguards, advertising norms to subordinate legislation and we respectfully suggest publishing draft rules for public comment and organizing structured roundtables on sensitive issues to make consultation permanent.

We humbly suggest the formation of a Standing Advisory Committee under MeitY, bringing together regulators, industry, mental health professionals and consumer groups, and such a body could provide continuous feedback as TRAI, SEBI and RBI already do. We request for greater certainty and we humbly request consideration of the following clarifications around ambiguities—that prohibition applies only to pooled stake formats and not subscription or ad-funded games; that gamified marketing schemes and loyalty programs be carved out; that ancillary service providers be shielded from liability; that Indian firms may lawfully export gaming services to other jurisdictions where compliant with local laws; that the Act's relationship with states’ laws and older central statutes be clearly specified; and that the Act provide detailed guidance on due diligence obligations, standards for content rating, parental controls, responsible gaming interventions and grievance redressal.

On approval and oversight mechanisms. Ladies and Gentlemen, we humbly submit a hybrid model for consideration. Self-Certification with Deemed Approval—Operators may self-certify Green Zone and Yellow Zone games with deemed approval unless where objections are raised within a fixed period. A Central Registry—where approved games may be listed in a central registry to give certainty to banks, app stores and payment providers. Regulatory Oversight—where regulators should retain the ability to review applications, issue reasoned orders and provide appeals; and this balances, we believe, efficiency with accountability and avoids unnecessary disruption.

We also request for a reasonable transition period. We respectfully recommend a phased implementation, ideally over 18 months, which would allow operators to wind down responsibly, to refund balances to consumers and give regulators time to establish digital compliance infrastructure.

We had the privilege of listening to Professor S. Mahendra Dev who said that the State's role in growth is very important and the States play an important role in cooperative federalism and in that spirit we wish to discuss the broader legal and constitutional considerations such as federal and legislative competence. The Constitution, ladies and gentlemen, places betting and gambling under Entry 34 of List II, which is the State List. While MeitY may wish to invoke Entry 31 of List I to regulate the online activity, such an expansive interpretation risks eroding state competence.

Courts have historically guarded this balance, as in the case of R.M.D. Chamarbaugwala vs Union of India (1957)—affirming gambling as a distinct legislative subject for states; in K.R. Lakshmanan vs State of Tamil Nadu (1996)—holding that even skill-based games with wagering elements fall under gambling regulation; and the principle of federal balance recognized in S.R. Bommai vs Union of India (1994) forms part of the basic structure. An interpretation that hollowed out large parts of Lists II and III merely because activities have migrated online may be seen to be constitutionally untenable when faced with judicial scrutiny.

On fundamental rights and proportionality. Ladies and gentlemen, Article 19(1)(g) guarantees the freedom to practice any trade or profession and restrictions must satisfy the test of proportionality which is based on four prongs, the first being legitimate aim, the second being a rational connection, the third being least restrictive means. And a blanket prohibition may not be seen as the least restrictive option when regulation can achieve the objective balancing of impact. Killing an entire business model is perhaps disproportionate to the social harm that is sought to be avoided. And this framework, as I mentioned earlier, was crystallized in Modern Dental College vs State of Madhya Pradesh (2016) and the K.S. Puttaswamy vs Union of India (2017) judgment. And it underscores that prohibition may fail constitutional scrutiny.

Therefore, ladies and gentlemen, in the spirit of institutional balance, we suggest a co-regulatory model. The Center could handle cross-border aspects—payments, money laundering, fraud—while states regulate gambling, advertising and consumer protection. To coordinate, a National Gaming and Responsible Technology Authority could be established modeled along the lines of the GST Council and such a body would ensure national coherence while respecting state competence.

We also recommend a risk-based classification where we propose replacing the outdated and archaic skill-versus-chance binary with a risk–purpose matrix: the Green Zone, which will include educational and social games with minimal oversight; the Yellow Zone, which will have casual games with in-app purchases with a light safeguard; Orange Zone for moderate-risk formats with licensing and audits; and the Red Zone for high-stakes formats with stringent safeguards or prohibition, if unmitigable.

Corporate Digital Responsibility needs to be embedded in licensing obligations—parental controls, spending caps, playtime prompts, cooling-off periods, independent audits, design features that do not exploit compulsive behavior, strict advertising codes particularly around celebrity endorsements, independent ombudsman for grievances, transparency dashboards with quarterly compliance data. This, ladies and gentlemen, in our view would align India with international best practices and send a strong message of responsible governance.

In summation, ladies and gentlemen, the Promotion and Regulation of Online Gaming Act 2025 is a milestone. It is a landmark initiative. Our suggestions are humble recommendations intended to strengthen its implementation. We believe that a framework that is consultative in process, proportionate in design and cooperative in governance will safeguard consumers, preserve revenues and enhance India's reputation as a responsible digital leader.

We place these thoughts before you with the utmost respect and stand ready to support the government in refining rules, engaging with stakeholders and building institutional capacity. Thank you.

Participants at the Intersection of Democracy: Federalism Finance and Development