Levelling up: India’s paid gaming industry is hitting new high scores

Gone are the days when sports were only played on fields and courts. Today, some of the fiercest competitions happen in the digital arena.

The numbers speak for themselves – India’s gaming sector continues to expand, reaching $3.8 billion in FY24, with projections estimating $9.2 billion by FY29 at a ~20% CAGR. The country now has 591 million gamers, with 23 million new players added in the past year, making it the second-largest market for mobile game downloads.

Player engagement has increased, with average weekly gaming time rising 30% to 13 hours. The number of paying gamers reached ~150 million, with an annual ARPU of $22, reflecting a 15% increase from FY23.

Source: Statista

The industry is booming with mobile gaming expanding beyond metro cities and esports turning into real careers. Faster internet, affordable smartphones, and a young, digital-first generation are driving this growth. Let us dive in!

The rise of India’s paid gaming boom

India’s gaming landscape continues to expand, with ~150 million paying gamers, including 8 million new users added in FY24.

The real game-changer? In-app purchases, which soared 41% YoY, with mid-core titles like BGMI, Free Fire Max, Clash of Clans, and EA FC Mobile leading the charge—racking up a 53% revenue surge. As internet access deepens and gaming culture evolves, India’s appetite for premium gaming experiences is only getting stronger, proving that players here are ready to pay for play.

The game changers

From casual play to fierce competition, mobile gaming and eSports are redefining India’s gaming experience and steadily fueling its growth.

Mobile gaming: Powering the play

Mobile gaming has become a dominant segment of India’s gaming industry, contributing 77.9% of total gaming revenue in 2024, compared to PC gaming (14.5%) and consoles (7.7%). The expansion is largely influenced by increased smartphone penetration, affordable data plans, and a growing demand for regional-language games, broadening access to gaming across diverse user groups.

Source: Niko partner, 2024

Esports: The rising star

Esports, or competitive video gaming, has grown into a global industry. In 2023, the audience reached 532 million, generating over $1.4 billion in revenue through sponsorships, streaming, and tournaments.

India’s esports players surged from 0.5 mn in 2021 to 0.6 mn in 2022, with projections reaching 1.5 mn by 2027, reflecting the country's rising interest in competitive gaming.

Source: Statista

How many youngsters are using this as a full-time career? Nearly 50% of Indian gamers are aged 18-30, preferring mid-core and hardcore games, especially fast-paced shooters requiring skill and reflexes. Mid-core games like BGMI, Clash of Clans, and Free Fire offer engagement without the heavy commitment of hardcore titles like Valorant and Dota 2, which demand strategy, teamwork, and hours of practice.

Storyboard18 reports that 30% of gamers are 31-45, favoring strategy games, reflecting a growing interest in professional gaming.

Here are some top gamers in India:

Source: News articles; *Latest available data

What is the Indian government doing?

With game-changing moves in support and regulation, the Indian government is shaping the future of gaming. The game is on, and India is ready to lead.

• Stronger Regulation: The IT Rules 2021 ensure a safer gaming industry by addressing harmful content and addiction.

• AVGC Growth: The AVGC Promotion Task Force (launched in April 2022) drives innovation and talent in Animation, Visual Effects, Gaming, and Comics. The upcoming National Centre of Excellence for AVGC-XR in Mumbai will further boost R&D.

• Grassroots Gaming Expansion: Esports is growing beyond metros. Nagaland hosted its first Hornbill Esports Championship (Dec 2024) with 300-400 players competing for ₹6 lakh across BGMI, Dota 2, and FC24. Bihar is set for the National Esports Championship in June 2025, while Meghalaya is fueling demand for gaming infrastructure in non-metro regions.

But challenges loom…

Growth is unstoppable, but so are the challenges - regulatory twists and tax hikes put the industry to the test.

• States like Telangana and Andhra Pradesh have banned certain games, while Karnataka has adopted a more lenient approach. This inconsistent regulatory landscape creates challenges and uncertainty for the gaming industry.

• The GST Council of India decided to impose a 28% GST on online gaming, casinos, and horse racing on July 11, 2023. This significant tax increase has posed challenges for smaller players and startups in the gaming industry, making it more difficult for them to remain financially viable. Take the example of the Fantasy Sports (FS) market. After the GST rate increase, the segment saw a 90% drop in funding in 2023 and zero new investments in 2024.

What’s next for India?

Despite challenges, India’s gaming market is set for steady growth, with mobile gaming leading the charge, driven by increasing internet access and affordable smartphones. Esports is also gaining momentum, creating new opportunities for players, streamers, and organizers.

Live streaming, brand sponsorships, and competitive tournaments are turning gaming into a profession. With trends like real-money gaming and the rise of esports, the industry is diversifying and expanding, positioning India as a growing hub in the global gaming ecosystem.