US$ 369.06 billion (Rs. 26 trillion) of India's economy formalised in FY16-FY23, says SBI
- IBEF
- June 24, 2024
According to a report by the State Bank of India (SBI), India has significantly formalized its economy between FY16 and FY23. The share of the informal economy has declined from 25.9% to 23.7% during this period, transforming to US$ 369.06 billion (Rs. 26 trillion) being formalized. The report estimates that the total informal GVA increased from US$ 284.14 billion (Rs. 18.6 trillion) in FY16 to US$ 743 billion (Rs. 58.4 trillion) in FY23, with informal agriculture contributing the largest share at US$ 547.07 billion (Rs. 43 trillion). While the share of informal industry and services has declined, informal agriculture in total GVA has increased from 94.8% in FY11 to 95.9% in FY23.
The report also highlights the growth in unincorporated enterprises, particularly in rural areas, with "other services and trade" leading the way. It notes that the bottom of the pyramid accounts for 44% of the population spending less than US$ 3.65 daily. The report suggests that while the economy is formalizing faster than the labour force, the launch of the E-Shram portal, which has registered nearly 297 million unorganized workers, holds promise for accelerating the formalization of the labour force and improving migrant statistics.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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