The share of the large informal sector in overall economic activity dipped sharply in 2020-21, an SBI report said.
This shows a greater shift towards the formalisation of the economy.
The share of the informal economy may have shrunk to no more than 20% of the economic output.
A senior SBI official termed this “a positive development”.
An IMF policy paper had estimated that the share of India’s informal economy in the Gross Value Added was at 53.9%.
The informal sector consists of unorganised enterprises employing hired workers.
The highest share of such unorganised activity is in agriculture where holdings are small.
