‘Online gaming can earn government $300 million’

By Vishnu Makhijani, IANS

New Delhi : Online gaming has the potential to fetch the government at least Rs.12.5 billion ($318 million) a year with the figure steadily rising over the years, says the chief executive of the company that pioneered online lottery in India.


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“If the government permits online gaming, we estimate that it will generate business in the region of Rs.250 billion ($6.37 billion) in five to 10 years. Of this, five percent (Rs.12.5 billion) will accrue to the government by way of taxes,” said Amar Sinha of Pan India Network Infravest that runs the Playwin lottery brand.

“This money can be used to fund social sector projects in the fields of education, healthcare and the welfare of senior citizens,” Sinha, whose company is part of Subhash Chandra’s $1-billion Essel Group, told IANS.

Since online gaming is aimed at the upper end players “who have deep pockets, the potential for the government to earn revenue is tremendous. This can only go up over the years”, he pointed out.

“Besides, it will also help create large numbers of jobs and thus reduce unemployment,” Sinha added.

Globally, online gaming was a $200-billion industry as it had gradually eased out paper lotteries, he stated.

“As India globalises, it cannot be indifferent to the phenomena,” Sinha maintained.

“The challenge lies in making the government understand the revenue potential of online gaming and of the huge revenues it is losing out due to paper lotteries and illegal betting,” he contended.

“Online gaming will wean people away from both legal and illegal lotteries as it is completely transparent and is properly audited, in our case by Ernst & Young,” Sinha stated.

The size of the legal lottery business in India is estimated at some Rs.250 billion, with the grey market accounting for a similar figure.

Significantly, the government earns just one percent or Rs.2.5 billion from the legal lotteries as 90 percent of the collections are paid out by way of prizes and nine percent goes into administrative and other costs.

Apart from running the Playwin lottery that hopes to generate revenues of Rs.30 billion ($764 million) in fiscal 2007-08, Pan India is also readying for the launch in March of a casino on a luxury vessel that will be anchored in the high seas off Goa. The company also plans to ramp up its global operations.

The Rs.1-billion ($25 million) casino project will offer 20,000 sq ft of gaming area “that will rival the best Las Vegas has to offer,” Sinha said.

The company has purchased a ship for Rs.150 million ($3.82 million) that is currently being fitted out in Italy. The ship will be anchored in international waters off Goa. High-speed motorboats will ferry gamers back and forth.

Speaking about his expansion plans for Playwin, Sinha said he hoped to expand its global reach to Central Asia, Europe and South Africa.

“We are currently in Kenya, Cambodia and the Philippines and a lot of other opportunities are being contemplated,” he added.

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