India's gaming industry faces setback with 28% GST on online games, but Zerodha co-founder predicts it as the 'next big thing' for India, citing its larger size than the movie and music industries combined. The Indian gaming market is expected to reach $8.6 billion by FY2027
India's gaming industry faces setback with 28% GST on online games, but Zerodha co-founder predicts it as the 'next big thing' for India, citing its larger size than the movie and music industries combined. The Indian gaming market is expected to reach $8.6 billion by FY2027
PremiumRecently, India's gaming industry got a major setback after a team of politicians and experts decided to impose 28% GST on online games during the 50th Council meeting held in July. However, according to Zerodha co-founder Nikhil Kamath, the gaming industry is going to be the 'next big thing' for India. Backing his viewpoint about the online gaming industry, Kamath said wrote on X platform (formerly known as Twitter) that the gaming industry is doubled ($159.3 billion) the size of movie and music industries ($41.7 billion + 19.1 billion) combined.
According to Kamath's personal experience, the younger generation is less enamoured by cricket than his generation was.
He added that in the Fiscal year 2021-22, the share of games downloaded by Indians went up to 17% of the global downloads. An average Indian gamer paid around ₹1,700 for online games, he added.
Citing data from Venture Intelligence, he tweeted that the Indian gaming market is expected to grow at 27% per annum to reach $8.6 billion in FY2027.
In the past five years, the gaming industry in the country has raised $2.8 billion. There are three unicorns in the gaming space in India at present- MPL ($2.5 billion), GAMES 24 Seven ($2.3 billion), and Dream11 ($8 billion), respectively.
'GAMING INDUSTRY TO CREATE OVER 1 LKAH JOBS'
Further supporting his argument on the positive outlook for India's gaming industry, Kamath said the Indian gaming industry directly employs around 150,000 people, and of these 30% (15,000) are developers and programmers.
The average salary of a game producer as per the current market is ₹10 LPA, and that of a game designer is ₹6.5 LPA. He said that the next big thing for India is Esports which will generate around ₹100 billion of economic value by 2025.
'ESPORTS vs IPL'
Kamath, citing data from Sportkeeda, said that the prize pool of the esports industry is poised to outgrow the prize pool of IPL by FY2025. The prize pool of Esports may surge to ₹1,000 million against the Indian Premier League ₹650 million in the next one year, the data mentioned.
meanwhile, the Online gamers' association has requested finance minister Nirmala Sitharaman for a reduction of 28% GST, saying high taxation would lead to mushrooming of illegal gaming firms.
Gamers from Tier II and Tier III cities under the aegis of 'Indian Gamers United' in an open letter to the finance minister said that high taxation will push the gamers towards illegal and offshore platforms where no tax is payable but will put the gamers into a very high risk.
The association also pitched for making a distinction between games of chance like gambling and games of skill like gaming.