Finance Minister Nirmala Sitharaman unveiled the much-awaited Union Budget on February 1, 2023, which touched upon the many facets of the online gaming industry.
According to the Budget, mobile phone production in India has increased from 5.8 crore units valued at about Rs 18,900 crore in 2014-15 to 31 crore units valued at over Rs 2,75,000 crore in FY23. “To further deepen domestic value addition in the manufacture of mobile phones, I propose to provide relief in customs duty on import of certain parts and inputs such as camera lens and continue the concessional duty on lithium-ion cells for batteries for another year,” stated Sitharaman.
According to industry experts, an upsurge in mobile phone production has been the impetus for the boom of the fantasy and esports gaming industry in India. “Pocket-friendly smartphones have taken fantasy and Esports gaming to every corner of the country and a further decrease in its prices, as the government proposes to reduce customs duty on the import of certain inputs for mobile phone manufacturing will boost the sector’s growth like never before,” Rishabh Bhansali, co-founder, FanClash, commented on the announcement.
The number of gamers in India is expected to increase from 433 million to over 650 million gamers by FY25, according to the ‘Beyond the tipping point: A primer on online casual gaming in India’ report by KPMG. “The proposed relief in manufacturing devices will further reduce the purchase cost, expanding the reach of smartphones to the masses. Mobile phones have been enablers of video gaming, especially casual gaming which is often an entry point for many,” Rajan Navani, founder and CEO, JetSynthesys, observed.
Industry professionals such as Animesh Agarwal, founder and CEO, 8bit Creatives, consider that there needs to be a relationship between mobile companies and the strengthening presence of gaming in India. “From launching gaming-specific devices such as One Plus Nord, ASUS ROG gaming phones to hosting multiple events and tournaments for the community and working with gamers to build a community of mobile gamers, mobile device companies such as One Plus, ASUS, Samsung and others are investing heavily in the gaming industry in India,” he emphasised.
Additionally, Sitharaman claimed that the government would set up 100 labs using 5G services in engineering institutions to develop applications. For the government, this measure is to realise a new range of opportunities, business models, and employment potential. Following this announcement, Gaurav Kapoor, chief finance officer, Baazi Games, opines that the budget further strengthens the significance of the technology sector as one of the key growth drivers for the country. “This is evident from various announcements including a focus on developing digital infrastructure, enhancing AI capabilities, an impetus to 5G-based applications and concrete upskilling initiatives that are aligned with industry needs,” he further highlighted.
As per the market research firm, Statista, the revenue earned by India’s online gaming industry exceeded Rs 100 billion in the year 2021 which is estimated to go beyond Rs 153 billion by 2024, it added. “India’s position from being an importer to an exporter of smartphones has benefitted the domestic market from an animation, visual effects, gaming and comics (AVGC) perspective. The affordability of mobile devices, boost given to 5G, AI and framework of data security are positive signs that will further catalyse the growth of the sector,” Siddharth Sharma, vice president (strategy), Head Digital Works, elaborated.