The word emerged during the YouTube battle between PewDiePie vs T-Series.
The consensus amongst Internet Historians is that it was first used in Q3 2018, although there are 9 year olds who claim they have seen it used even as early as December 2017.
It was first used to refer to T-Series in a derogatory manner. Later, it also became used as an insult to other people.
T-gay can be used to make fun of a gay for being Indian, to make fun of an Indian for being gay, or to call somebody both Indian and gay in the same word.
Very effective!
Nick: Hey, did you fix your PC?
Gharr: Yeah, I called Microsoft and some T-gay solved everything.
...a few hours before...
Brrr... Brrr...
T-gay: Hello, sir!!! This is Reyansh!!! How may I help you?
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