Simply Speaking: India's Great Gaming Paradox

Gaming, once a niche pursuit, now earns more each year than film and music combined.

Over the past decade, the world’s biggest entertainment industry has quietly changed shape. It is the lingua franca of the digital generation, with over three billion players worldwide. Yet the true significance of gaming lies not in the numbers who play but in what it has become. It is the laboratory of artificial intelligence, the test bed for virtual worlds, and the foundation on which the synthetic economy is being built.

India, paradoxically, stands on both sides of this transformation. It is a gaming giant in consumption but a laggard in creation.

Over 580 million Indians play regularly, mostly on smartphones. The domestic market is growing fast and may cross nine billion dollars by the decade’s end. Yet the country has produced no global franchise, no studio of renown, and no homegrown equivalent of the creative powerhouses that transformed nations like South Korea, Finland or Poland. When young Indians log in, they play PUBG, Call of Duty or Clash of Clans.

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None are Indian creations.

This is not merely a cultural shortfall. It is a strategic one that will cost us dearly. The gap between those who play and those who produce is also the gap between those who consume AI and those who shape it.

Long before ChatGPT, researchers taught algorithms to learn by playing Atari games. The very chips designed for rendering virtual worlds now train the largest neural networks. Games built the grammar of machine learning. In that sense, gaming has been the unseen rehearsal space of artificial intelligence.

Against this backdrop, the Indian paradox grows sharper. We have the scale but not the systems. Policy uncertainty has slowed the sector. The decision to impose a twenty-eight percent GST on deposits in 2023 struck at the industry’s foundations, effectively taxing turnover rather than earnings. Investment dried up and jobs vanished. Capital remains impatient, chasing quick monetisation through casual and real-money formats rather than original IP.

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Our education system still produces coders, not game designers while our hardware costs, inflated by import duties, keep console and PC gaming out of reach for most.

While India debates regulation, the rest of the world is building ecosystems. Consider AppLovin, a company that began in 2012 as a small start-up helping developers find users for their apps. Today it is worth more than Uber and sits in the S&P 500. AppLovin’s AI-driven algorithm matches advertisers, mostly gaming companies, with the players most likely to engage. Its ad revenue tripled between 2022 and 2024, and it now serves nearly half the ads seen in mobile games worldwide. This success was not born of luck. It grew from a virtuous cycle of data, design, and algorithmic learning, an ecosystem that fused gaming with analytics, advertising, and AI.

AppLovin is just one node in a vast chain of value creation that begins with games but extends far beyond them. The same engines that render virtual landscapes now power digital twins for manufacturing plants, smart cities, and defence training.

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The tools of play have become the instruments of production. That is the frontier India risks missing. The absence of indigenous studios and middleware platforms means we are consumers of virtual worlds rather than creators of them. In the coming years, the industrial metaverse will demand precisely the kind of simulation and AI expertise that gaming cultivates. If we stay absent, we cede not just cultural ground but technological sovereignty.

India’s challenge is not a lack of talent but of translation. The country needs regulatory clarity that rewards innovation instead of penalising it.

It needs patient capital to fund ideas that may take five years, not five quarters, to mature.

It needs to train not only coders but storytellers, producers, and experience designers.

Above all, it must widen the domestic runway by making premium gaming accessible and commissioning Indian studios for training simulators, educational tools, and industrial twins.

The opportunity is immense, but so is the cost of inaction. The world’s next big platforms for work, learning, and imagination will emerge from the gaming ecosystem. India already plays within those worlds. The question is whether it will help build them.

If we do not create, we will only consume. If we do not code our own myths, we will live inside someone else’s simulation.

Shubhranshu’s Singh is a business leader, cultural strategist, and columnist. He was honoured as one of the 50 most influential global CMOs for 2025 by Forbes and serves on the board of the Effie LIONS Foundation.