Union Budget 2024: Indian Esports Industry hopeful of Government support and tax relief for growth

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New Delhi, Jan 30: The anticipation builds as Finance Minister Nirmala Sitharaman prepares to unveil the interim Budget for fiscal 2024-25 in the Lok Sabha on February 1. Among the myriad sectors awaiting governmental attention, the Indian Esports industry stands poised, seeking crucial support and tax relief to further its burgeoning growth.

The journey of Esports in India has been nothing short of remarkable, especially since its official recognition as a multi-sport event by the government. From being recognised as an official medal sport in the Asian Games 2022 to the potential prospect of Olympic inclusion, Esports has steadily climbed the ladder of mainstream acceptance.

In light of the upcoming budget, industry stakeholders have voiced their expectations, emphasising the need for the intervention of the Narendra Modi-led government to propel the sector forward. Key among the demands is a dedicated allocation of funds to bolster Esports infrastructure and incentivise homegrown video game publishers.

Lokesh Suji, Director of Esports Federation of India & Vice President of the Asian Esports Federation (AESF), stressed the importance of nurturing indigenous talent and fostering innovation within the community. He highlighted the necessity of tax relief for Esports athletes on tournament winnings, a move aimed at promoting long-term sustainability and attracting aspiring players to the field.

Mr Suji noted, "We hope to see a dedicated allocation of funds for the Esports sector, alongside incentives for Indian video game development studios. This will not only encourage innovation but also enable homegrown titles to prosper within the community.

"To ensure the long-term success of our Esports athletes and attract more aspiring players to pursue careers in Esports, we also hope for tax relief for athletes on winnings from Esports tournaments. ESFI will remain committed to working closely with the government to further elevate the status of Esports in the country."

The optimism surrounding the industry's growth is substantiated by recent reports, such as the "Leveling up: State of India Gaming FY'23" report by Lumikai in collaboration with Google, which projected substantial growth in the Indian gaming industry.

Animesh Agarwal, Founder & CEO of 8Bit Creatives and Co-Founder of S8UL, echoed the sentiment, emphasising the need for fair support and conducive policies from the government to foster continued growth in the Esports sector.

"The Esports industry is growing at an impressive percentage and is only forecasted to grow. We hope for fair support and conducive policies from the government in the upcoming budget to further foster this growth," Mr Agarwal stated.

State governments, too, have recognised the potential of Esports and are actively engaging with the industry through various initiatives, including organising tournaments and establishing Esports academies. States like Bihar, Madhya Pradesh, Kerala and Uttar Pradesh are actively engaging with Esports.

K.R. Rohith, CEO of Gods Reign, highlighted the importance of integrating Esports into educational curriculums and skill development initiatives to nurture talent and promote digital skills nationwide.

Mr Rohith said, "We hope for the government's consideration and support in encouraging educational programs by adding Esports into Educational Curriculums and skill development initiatives focused on gaming and Esports. This would contribute significantly to nurturing talent within the sector, aligning with the national agenda of promoting digital skills.

"In addition, we earnestly suggest the allocation of funds to each state government for the organisation and promotion of State Esports Championships. This collaborative effort with prominent Esports organisations at the state level, starting from the school level to the national level, will undoubtedly contribute to the organic growth of Esports across the nation," added further.

Among the key demands put forth by industry stakeholders is the reduction of GST on Esports activities from 28% to 18% and the introduction of regulations to streamline operations within the sector.

The gaming and esports sector in India is poised for robust expansion, with an anticipated annual growth rate of 35-40%. This growth is propelled by a maturing audience and favourable regulatory frameworks.

Recent policy advancements, including the official recognition of esports as a mainstream sport and the implementation of favourable state-level policies for AVGC-XR, hold considerable promise.

Suhaas Khullar, Chief Financial Officer, Loco said, "The Indian gaming and esports industry is experiencing a robust growth trajectory, projected to surge by 35-40% annually. This momentum is fueled by a maturing consumer base and supportive regulatory measures. Recent policy advancements, including the landmark recognition of esports as a mainstream sport and favourable state-based model policies for AVGC-XR, hold immense potential."

"These initiatives are already propelling grassroots talent development across diverse regions of India. For the upcoming budget, dedicated allocations for skill development and targeted tax incentives for the AVGC sector will be pivotal in realizing the 'Create in India' vision. Such fiscal support will foster sustained success and multi-decade growth in this sector," Mr Khullar adds further.

As the Esports community eagerly awaits the unveiling of the budget, there is a palpable sense of hope that government support will pave the way for a sustainable and thriving Esports ecosystem in India.

With the right interventions and policies in place in the interim budget, the Esports industry hopes to scale new heights, solidifying its position as a key player in India's digital landscape.