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Saturday, 30 March, 2002, 15:39 GMT
India's online lottery: It's a rollover!
Indians on the internet
Online gambling is targeted at the middle classes
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By Habib Beary
BBC correspondent in Bangalore
It is a rollover!

India's first online lottery draw failed to produce the winning match on Friday night.

It is exciting ... This is the first time I am betting my luck

Bangalore software engineer

The jackpot now goes forward to next week's draw, and a single winner will walk away from the computer with 20m rupees ($410,000).

In a country where the average per capita income is less than $50 a month, that is a huge sum of money.

India's information technology boom of the last decade has created hundreds of thousands of rupee millionaires.

But the latest hi-tech gamble with the country's first online lottery is about to create some more.

More than 1.8 million tickets have been sold from terminals around the country for the jackpot draw in the Himalayan state of Sikkim.

Expansion plans

"The online lottery system is catching on in a big way in the country," said Sanjay Das, chief executive officer of Playwin Infravest.

The company plans to install 3,500 computer terminal booths in 14 states in places such as restaurants, shopping malls and bus stations.

Roulette wheel
The government plans to use online gambling revenue for social projects

The group is a subsidiary of the Essel entertainment group based in India's commercial capital, Mumbai.

The group is headed by Subhash Chandra, who owns a string of satellite television channels under the Zee Network umbrella which will telecast the online draws live.

Playwin is eyeing the southern Indian states of Karnataka, where India's silicon valley in Bangalore is located, as well as neighbouring Maharashtra for similar online gaming projects.

"In Bangalore we have already set up 75 terminals and would be adding another 150 by this year end," said Mr Das.

One young software engineer, who did not want be identified, was anxiously awaiting the prize draw after buying six tickets at 10 rupees each.

"It is exciting. This is the first time I am betting my luck," he said.

Social projects

The launch of the online lottery system is being well received by the government, which believes tickets bought by the middle classes will bring increased revenues to the state governments for social projects.

Half of the total funds raised through the lottery will go as prize money, and 20% goes to the government as royalty.

Paper lottery tickets
Lower income groups play conventional lottery

This contrasts with the 1% revenue that the state governments earn from the sale of paper lottery tickets.

The governments which Playwin hopes to enter agreements with plan to channel the funds into education, rural housing, sanitation and infrastructure development.

At the moment, more than 20 million Indians buy conventional lottery tickets every day, spending about 500bn rupees ($10bn) annually.

Paper lotteries attract low-income groups while online lottery is targeting the relatively more affluent classes.

"We plan to have about 3,500 such terminals across the country by this year-end, and about 10,000 terminals in the next couple of years as the game of fortune catches up like cable entertainment," he said.

The global market size of the online lottery business is estimated to be $155bn.

See also:

25 Feb 02 | Business
Internet gambling hots up
04 Dec 01 | Business
India pushes for IT summit
07 Nov 01 | Business
India software exports slow down
26 Jan 01 | High Stakes
High Stakes: Problem gambling
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