Hoping to tap into the nascent Indian online games market, Mumbai-based Games2win announced Wednesday it had raised about $5 million from leading U.S. venture capital firms Clearstone Venture Partners and Silicon Valley Bank Financial Group.

The six-month-old Games2win.com website is currently dedicated to casual games based on quintessential Indian situations, such as racing rickshaws on bumpy roads. Other games are based on Bollywood films. The company’s first round of funding, in which Clearstone invested the majority of the funds, will be used to upgrade content, hire talent, and build the brand.

“We want to license globally popular MMOG [massive multiplayer online games] for India,” said Alok Kejriwal, CEO of Games2win.

Mr. Kejriwal said there is huge demand for such games, but spending habits of Indian gamers are conservative. Mr. Kejriwal expects players to spend an average of about 100 rupees [$2.20] a month on an average on games. Games2win will distribute smartcards similar to prepaid cards for mobile phones that allow customers to pay in advance for service.

Some 3.5 million people play online games in India, according to Mr. Kejriwal, but the numbers are likely to grow 50 to 100 percent every year for the next five to 10 years. In April 2006, a study by San Francisco-based analyst and consulting firm Pearl Research had forecast that the online games market in India would exceed $200 million in 2010.

The Pearl report said the Indian online games market is being driven by the rapid adoption of the Internet, increased broadband penetration, the growth in Internet cafés, and a sizable middle-class with rising disposable income.

Another trend that will bring in new players is the opening of gaming-oriented cafés such as local Internet company Sify’s Gamedromes. Meanwhile, Indian conglomerate Reliance ADAG in November launched casual gaming site Zapak and said it will invest $100 million in the venture.

“We want to invest in the Internet space in India. After scouting for months, I think we found the gold standard in Games2win,” said Rahul Khanna, a director at Clearstone.