India's economy takes 'formal' leap as informal shrinks drastically: Study

15-20% of economy informal now as against 52% in FY18; digitisation, gig economy key drivers: Study

The share of the informal sector in India’s economy fell drastically to 15-20 per cent in 2020-21 from 52.4 per cent in 2017-18 due to digitisation and the rapidly expanding gig economy, according to a study by SBI Research.

“Currently, the informal economy is possibly at maximum 15-20 per cent of gross value added (GVA)," said Soumya Kanti Ghosh, group chief economic advisor, SBI.

The share stood at 53.9 per cent in 2011-12. As such, the formalisation of the economy crawled between 2011-12 and 2017-18 but gathered pace between 2017-18 and 2020-21.

However, Madan Sabnavis, chief economist at CARE Ratings, said the employment