India’s digital landscape has rapidly evolved over the past two decades. With over 700 million internet users, the country is now one of the world’s largest and fastest-growing markets. According to a report by the Observer Research Foundation (ORF), India’s electronics industry is expected to reach USD 300 billion, and its digital economy could hit USD 1 trillion by 2025-26. This growth, in turn, may contribute 18-23% to the national GDP.
A key factor behind India’s digital economy growth is the booming online gaming sector. This sector, as a result, is poised to play a major role in achieving the country’s ambitious digital economy target. It will not only attract foreign direct investment (FDI) but also increase tax revenues, create jobs, and support complementary industries like fintech, Web 3.0, augmented reality (AR), and cybersecurity.
Additionally, the gaming sector is driving demand for processors, content, devices, and broadband. This, in turn, accelerates technological development across industries, including media, healthcare, manufacturing, and automotive.
A Finnish study highlights how gaming innovations spill over into other sectors. Gaming companies, therefore, lead the way with rapid development cycles, new organizational models, and cutting-edge technology. Many of these innovations are later adopted by industries like real estate, IT, and energy.
Moreover, technologies such as game engines, virtual reality (VR), AR, and rendering software are now used widely across various sectors. For example, healthcare utilizes VR and AR for medical training, while manufacturing integrates rendering software to improve processes. These advancements could similarly help India’s industries become more efficient, just as they have in the UK and Nordic countries.
The success of India’s gaming sector is closely tied to the fintech industry. Digital payment solutions, in particular, have been crucial for gaming’s growth. One major gaming platform processes over 4 billion micro-transactions monthly, which accounts for approximately one in every 300 UPI transactions in India. Furthermore, 20% of players on this platform make their first digital payment through it, highlighting how gaming contributes to fintech adoption.
As the gaming sector continues to flourish, it will, in turn, stimulate growth in fintech, leading to new and innovative payment solutions. This synergy will further support the broader digital economy.
India’s gaming sector is much more than just entertainment. It is a driving force for technological innovation and economic growth. As the sector continues to expand, it will play an increasingly important role in India’s digital future. Ultimately, the gaming industry is set to be a key contributor to India’s goal of achieving a USD 1 trillion digital economy by 2025-26.
