In this blogpost, Pramit Bhattacharya, Student, Damodaram Sanjivayya National Law University, Visakhapatnam, writes about the pros and cons of making betting legal in India.

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Betting can be a very scandalous topic, especially when considered in the context of betting in sports. For some, it can be viewed as the growth of an economy, and thriving industry, for others it can be viewed as marring the spirit of the game and corruption among the sportsperson.

Talking about betting in the Indian context, especially with regards to betting in cricket, the debate has been a long drawn one. There are contrasting views about it, but the recent trends indicate that there is a careful inclination towards legalizing betting in sports.

Before going into the intricacies of it, let us see what the effects of making gambling illegal are (it is in common knowledge that betting is illegal in India).

Whenever we are talking about any law, we need to see the pith and substance of the law, i.e., the object behind. And based on that object a law can be good or bad. As a civilized society, we understand what good laws are. Any law or statute, protecting the rights of an individual, and protecting him from harm, which may be caused by other are deemed to be good laws. In this sense, a law protecting a person from himself can also be considered a bad law. Arguments against legalizing betting are mainly focused towards protecting a person from himself. When a person is unable to make any sound decision overwhelmed by his greed for money, the government intervenes and tell them how to conduct yourself responsible way. But such restriction on the part of the government incriminates everyone, even those who can act responsibly. One more argument against betting is that it appeals to the criminals factions. However, plethoric restriction attracts more crime. Sometimes excessive restriction creates more problems than they were intended to untangle.

Here are some negative impacts of illegalizing betting-

  • Black Market

A complete restriction on betting has not eradicated it but has sent the activity ‘underground’ covered in the murky undertakings of the crime syndicates. Such restrictions rather broaden the operation of criminal activities instead of restricting them. Where an individual could have placed his bet with a controlled and licensed establishment, he gets entangled in a black market, where no protection of the law is granted. Such black markets also fill the coffers of the crime syndicates and allow them to make a profit out of activity, which they shouldn’t have been able to do had it been legal. Such increase in profits also draws out many more people to these criminal syndicates to fill their pockets more easily.

  • Match fixing

With betting activities going underground, it becomes harder to dragoon and oppress the problem of match fixing. Criminals are not very interested in following the law from the outset only. Add to that the huge amount of money involved in betting and the problems gets a lot worse. Matches are fixed to make more and more amount of money. This problem does not rear its ugly head in a regulated market, where the reputation of the bookmaker or the establishment is the prime concern of the bettors. If a licensed bookmaker or establishment is caught in the scandal of rigging games, their business would be ruined both legally and in terms of customer base. Also, when betting is done in the open markets, they are easily traceable, thereby reducing the chances of rigging.

  • A Setback to the economy

A boost in the economy always helps and legalizing betting does provide that boost. The economy loses a lot of money to betting, and it also increases the amount of black money being circulated in the market. Moreover, profits of betting can’t be taxed, as these profits are not under the purview of taxable income. This way also the economy loses a lot of money.

Coming back to the point of legalizing of betting, no other problem has marred Indian sports especially cricket than betting and match fixing. Betting is illegal in India, but still the betting markets exist, which are being controlled by the dark underworld. The fact apart, people from different walks of life has spoken about legalizing betting in cricket. When people like ex-CBI chief, Ranjit Sinha and former captain of the Indian cricket team, Rahul Darvid talks about legalizing of betting in cricket, you got to take notice of the fact.

In the year 2000, the Delhi Police busted a match-fixing scandal involving players like Hansie Cronje, Mohd. Azharuddin and Ajay Jadeja. Very recently, these players were banned from the IPL for their involvement in match-fixing scandals (in the 6th edition of the IPL, S Sreesant, Ankit Chavan and Ajit Chandila were banned for fixing a match)[1]

The Lodha Committee headed by former Chief Justice R M Lodha, which was set up set up to investigate the spot-fixing incidents that took place in the IPL,  also suggested that betting should be legalized to curb the menace of match-fixing. Chairman of the ICC’s Anti-corruption Unit, Sir Ronnie Flanagan has also been very vocal about the idea of legalizing betting in India. According to him, it would be much easier to track incidents of spot-fixing and game-fixing if the betting Industry is legalized in India.

“If we talk about countries (like England) where betting is legal and heavily regulated, we have a Memorandum of Understanding with the legitimate betting industry and we find that is helpful because they report to us on any unusual spike in betting about a particular event or a particular time and we investigate it and they stop taking bets when that happens. Obviously, in the black market, the betting industry is harder to track.”[2]

According to him, it’ll also help the ICC, if India legalizes betting. He states that where betting is legalized it is heavily regulated, and they work in close conjunction with us, so it does assist the ICC. But he also emphasizes on the fact that it is not for him to suggest what India should do in terms of legislations and laws regarding the issue of legalization of betting. But if at all betting is legalized in India, he believes that ICC will be seeking close collaboration who would govern the activity of betting.

Various arguments can be given in favor of legalizing betting in sports (specifically with respect to cricket). A few arguments given in favor of legalization of betting are as follows-

  • It is very evident that numerous influential personalities are involved in the business of betting in sports, and it is a big business issue, albeit unofficially. It would be right for the government to legalize betting and make it a taxable income.
  • Legalization of betting and gambling in sports can also help in the terms of employment generation and total output. Consider the fact- as of year 2015-13,207 million pounds gross value added transaction occurred in the gambling and betting industries.[3]
  • In terms of employment also legalizing of betting and gambling has created numerous jobs. At the end of the financial year 2015, the betting and gambling industry employed 104, 869 people.[4]
  • Betting is not bad per se. It is just another game linked with economic benefits and losses. Technically the Indian share market can also be termed as a field for gambling and betting. There is no certainty when the share prices will go up or down. If speculations of shares are legalized, why not speculation is sports. A few other forms of betting and gambling in India like betting on Horse Races and Casinos are legalized in India.
  • One of the fact to be considered is that criminalization of betting does not stop it from happening. According to reports betting money involved in IPL-7 and IPL-8 were around Rs. 7,000 crores and Rs. 12, 000 crores respectively.[5]
  • In these times of struggling global economy taxing the profits earned by betting can be a very appealing option. The best option would be that the government comes out with clear laws and legitimize betting and protect the consumers. This will be much preferred rather than outright prohibitions which create further problems. It is a win-win situation for both the government and the bettors. By creating a safe environment for betting, the government can earn financial benefits from the tax revenues. It’ll also help the consumers to place their bets in the open market where the money is traceable, instead of getting entangled in the world of criminal organizations.

Betting as a vice cannot be eliminated. Such activities are taking place even when it is illegal. So instead of turning its back to the problem, the government should find solutions. Once the market is open, people will prefer to bet through fair channels, online or offline. It will suck out the liquidity from the unregulated market, and chances of fixing will reduce drastically. The greatest advantage of regulating sports betting is that there will be accountability for the large amounts of money transferred through illegal channels leading to a reduction in cases of match fixing, money laundering, and crimes. Also, with the changing times, the society has come to accept betting activities and not see betting as nefarious. According to a survey done by FICCI, 68% people believed that betting activities can be controlled by a proper framework and almost 83% of the participants of the survey stated that regulating betting in sports with proper laws is much better than completely prohibiting it.[6]

Therefore, the need of the hour is to come up with an active regulatory framework- whether the principle philosophy is to permit or restrict betting, but not completely banning it.

[1] http://sports.ndtv.com/cricket/news/214024-sreesanth-chavan-banned-for-life-bccis-official-media-release

[2] http://www.rediff.com/cricket/report/how-legalising-betting-in-india-could-prevent-fixing-in-cricket-flanagan-world-t20-wt20-lodha-pix/20160306.htm

[3] http://www.gamblingcommission.gov.uk/Gambling-data-analysis/statistics/Industry-statistics.aspxhttp://www.gamblingcommission.gov.uk/docs/Industry-statistics-April-2010-to-March-2015.docx

[4] http://www.gamblingcommission.gov.uk/Gambling-data-analysis/statistics/Industry-statistics.aspxhttp://www.gamblingcommission.gov.uk/docs/Industry-statistics-April-2010-to-March-2015.docx

[5] http://www.oneindia.com/feature/oneindia-exclusive-ipl-betting-dossier-bookies-put-in-rs-7000-crore-in-2014-1630631.html

[6] http://ficci.in/spdocument/20254/report-betting-conference.pdf

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