Internet and Mobile Association of India (IAMAI), an industry lobbying body for digital companies, Monday said that the South India State of Karnataka Bill proposing a ban on online games was badly drafted and not progressive.

Pointing out that the Karnataka Police Act (Amendment) Bill, tabled in the State Legislative Assembly, will provide conducive environment for the online skill gaming industry, IAMAI said the bill “appears to have been drafted without considering the various legal and constitutional positions by including a wide definition of ‘gaming’ in amendments” against various judgements of the Supreme Court and high courts.

“Legislative actions such as this, may create a cloud of confusion and create regulatory uncertainty, which may unintentionally result in investors recalibrating their investments in the state and many existing companies may consider shifting base from the state,” IAMAI said in a statement.

It also urged the State Government to take a “progressive view” and ensure that legitimate online gaming companies, which are protected under Article 19(1)(g) and Article 14 of the Constitution of India, continue to operate in the State.

The bill has been introduced in the backdrop of a public interest litigation (PIL) filed in the Karnataka High Court seeking a ban on online gambling. After the State cabinet approved the Bill, State Law Minister JC Madhuswamy informed the media that the proposed law was to ban online gambling and games of chance in the State.

“IAMAI is of the view that the Bill may hurt Karnataka’s position as the country’s startup hub and lead to loss of jobs and revenue for the State. There are 92 gaming companies registered in Bengaluru, which employ over 4,000 people. In the past three years, international investors have invested around INR 3,000 crore in gaming and animation startups in the state,” the industry body pointed out, highlighting why the law on online gaming was bad economics.

IAMAI further stated that Karnataka was one of the first States to come up with an AVGC (Animation, Visual Effects, Gaming and Comics) policy, recognising the immense potential the sector held for the digital economy.

The Internet and Mobile Association of India is an association with claimed ambitions of representing the entire gamut of digital businesses in India. It was established in 2004 by the leading online publishers, and in the last 16 years has come to effectively address the challenges facing the digital and online industry, including mobile content and services, online publishing, mobile advertising, online advertising, digital entertainment, ecommerce and mobile and digital payments among others.