The informal sector plays an important role in India’s labour market. According to official statistics, it contributes more than half of the gross value added in the economy, which varies across sectors, the highest being in agriculture, construction, and real estate. Informal employment, on the other hand, is more entrenched:
It exists in both informal and formal sectors.
Chart 1 shows that about 88 per cent of India’s workforce is informal, or without any social security. About 8 per cent is informal employment in formal entities. An analysis of employment in India’s manufacturing sector, published in a World Bank report