Karnataka on Tuesday banned online games involving betting and wagering. The order read that "any act or risking money, or otherwise on the unknown result of an event including on a game of skill" is banned.
India has a booming gaming sector, and foreign investors have been keen on putting millions of dollars into the gaming market in recent months, reported Hindustan Times.
Sequoia Capital-funded Mobile Premier League (MPL) has already begun blocking access to the players in Karnataka. On Wednesday morning, the users received messages that read, "Sorry! The law in your state does not permit you to play Fantasy sports", "Fantasy games are locked", and "cash games are locked". MPL allows real-money wagering for fantasy cricket and football games.
Paytm First Games also stopped operations in the state. However, another popular gaming app backed by Tiger Global, Dream11, remained operational today. There have been growing concerns about the financial harm and addictive nature caused by these online games.
Telangana and Andhra Pradesh have already imposed similar bans on online games. Tamil Nadu's Bill was struck down by Madras High Court. As per the new law, violators will be faced with hefty fines and prison terms.
Users from these states accounted for about 20% of the business for gaming companies, reported Reuters. The chief executive of the All India Gaming Federation, Roland Landers, told HT that the industry would challenge the bans in court.