India's esports sector is navigating a challenging landscape following the introduction of new gaming regulations effective May 1, which formally recognize esports but also separate it from real-money gaming. This shift has led to a 7.5% revenue decline in 2025, as many real-money gaming companies, previously significant sponsors, exited the market. Despite this setback, industry experts remain optimistic about the future. They anticipate growth driven by increasing viewership and participation, particularly in tier-II and tier-III cities, alongside support from state and central governments. Karan Pathak, associate director of esports at Krafton India, noted rising interest from consumer brands and tech companies in esports. Additionally, Rajan Navani, chief executive of JetSynthesys, pointed out that monetization will increasingly rely on integrating tournament intellectual properties and developing franchise models akin to the Indian Premier League (IPL). The FICCI-EY report projects that the video games and esports market will expand from ₹63 billion in 2025 to ₹92 billion by 2028, indicating a potential rebound in the sector.