The Narendra Modi government’s last full Budget before the 2024 general elections tried to cater to as many segments of the population as possible, and even though it didn’t specifically bring out the matters of concern related to AVGC sector, specifically the gaming and esports segments, there were some decisions which are sure to impact the burgeoning industry.
Suhas Khullar, CFO, Loco, believes the Union Budget for 2023–2024 is “commendable for setting the bold vision of making India a tech superpower. Two initiatives focusing on capability building for the tech ecosystem stand out. First, the intention to set up 100 labs for developing applications using 5G services has the potential to open up a wide range of prospects for the ecosystem, including esports. Second, setting up of centers of excellence for AI under the ‘Make AI in India’ and ‘Make AI work for India’ vision, along with the introduction of Pradhan Mantri Kaushal Vikas Yojana 4.0, will help young people in developing the necessary expertise in coding, artificial intelligence and other technologies.”
These enhanced digital skills will now support the sector's capacity to grow into a significant employer. Manvendra Shukul, CEO, Lakshya Digital was also heartened to see the Finance Minister’s continued focus on the most crucial building block for every sector - skilling India.
“A wide range of sectors, including the gaming industry, are facing a shortfall of skilled workers. India has a huge opportunity to be a leader in the global gaming market. However, for us to compete with entrenched players like China, it is essential to develop a strong pipeline of skilled workforce,” he said, adding, “We look forward to an effective implementation of Pradhan Mantri Kaushal Vikas Yojana 4.0 that will allow our youth to upskill and be job-ready for the global gaming industry.”
Gaurav Kapoor, Chief Finance Officer, Baazi Games, also welcomes the “Amrit Kaal” Union Budget 2023 with an optimistic perspective.
The new income tax regime will result in stimulating local demand and consumption in the economy. The rise of India’s position from an importer to an exporter of mobile phones in India augurs well for the online gaming sector. Moreover, the announcement of setting up 100 labs for developing 5G services apps for smart classrooms, healthcare, and others will open up a new range of opportunities and potential employment. Simplifying the KYC system process will further help in realizing ‘Digital India’ and will enable a seamless experience for consumers. Lastly, the ‘Make in India’ vision will further get a boost with a focus on ‘Make AI in India’ and ‘Make AI work for India’, and online gaming companies can develop new AI-based advancements that can provide a first-of-its-kind experience to users.
Sunil Yadav - CEO, PlayerzPot, says the Budget announced a welcome move in defining the future of the online gaming industry by removing the minimum threshold of Rs. 10,000 for TDS to clarify taxability. “The action will result in transparency, a clear legal identity, and standardized taxation for online gaming. We hope that the government will unquestionably support the sector's growth and development in the right direction, which will benefit the economy and its stakeholders,” he says.
Rohit N Jagasia, Founder and CEO of Revenant Esports, agreed that the announcement of removing minimum threshold of Rs 10,000 for TDS on online gaming and providing clarity on taxability is a big step forward, adding, “However most esports games, like ours, don't have any money withdrawing system so these are applicable for the online gaming sectors which are into real money gaming.”
Rishabh Bhansali, Co-Founder of FanClash, says the enormous upsurge in mobile phone production has been the impetus for the boom of the esports industry in India. “Pocket-friendly smartphones have taken gaming and fantasy esports to every corner of the country and a further decrease in its prices, as the government proposes to reduce customs duty on import of certain inputs for mobile phone manufacturing, will boost the sector's growth like never before,” he says.
Indeed, the expansion of India's gaming business mirrors and contributes to the growth of the mobile phone industry. The number of mobile gamers in India is projected to increase to 650 million by 2025, according to the most recent report from the Internet and Mobile Association of India (IAMAI).
Animesh Agarwal, Founder & CEO, 8bit Creative, notes that the previous seven to eight years have been instrumental to the relationship between mobiles and gaming in India, with numerous mobile gaming titles being released and gaining popularity among the Indian gaming community.
“Developer dedication to expanding mobile gaming in India and the advent of different employment opportunities through mobile gaming have all contributed to an increase in the number of Indians adopting mobile gaming. This has also contributed to the growth of the mobile device sector, as professional gamers frequently seek to upgrade their devices as they progress in their career. Even casual gamers seek better devices in their gaming journey,” he says.
This interdependence of the industries is also reflected in the commitment of the mobile device companies towards strengthening their presence in the gaming community through dedicated efforts and investments. From launching gaming-specific devices such as One Plus Nord, ASUS ROG gaming phones, etc., to hosting multiple events and tournaments for the community, to working with gamers to build a community of mobile gamers, etc., mobile device giants are also investing heavily in the gaming industry in India.
Rohit Agarwal, Founder and Director, Alpha Zegus, points out that the increase in smartphone production in our country will bring down smartphone costs drastically - which will be a big win for the gaming industry. “More advanced smartphone tech will be available at accessible pricing, which means gaming will eventually no longer be restricted by hardware capabilities.”
Experts say that Indian gaming has the potential to provide a significant boost to the electronics industry as a whole, including consoles, PCs, VR gadgets, mobile devices, wearables, IT accessories, and so on.
Lokesh Suji, Director, eSports Federation of India and Vice President of the Asian eSports Federation (AESF), concludes, “With the numbers of devices as well as gamers further upscaling and 5G acting as a catalyst that fuels the industry's growth, we are going to witness monumental growth within the esports sector in the coming years. As we are still awaiting clarity on the taxability for esports, we are hopeful that the decisions will be in favour of the community and impact it positively.”