National Accounts Division of the Ministry of Statistics and Programme Implementation (MoSPI) organised a half day consultation on ‘Estimation of Informal Sector in Gross Domestic Product (GDP)’ on 30^th January,2025 in Tagore Chamber, SCOPE Convention Centre, New Delhi.

The consultation was organized to broad base the consultation on the current effort of the Ministry to revise the base year of GDP from 2011-12 to 2022-23. It was aimed to discuss improvement in the methodology as well as incorporation of new data sources in the estimation of informal sector of the economy in the revised GDP series. As per National Accounts Statistics, the informal sector contributed about 45% to the total GDP of the economy in FY 2022-23. From the labour perspective, about 61% of women workers in non-agriculture sector are working in informal sector enterprises as per Periodic Labour Force Survey(PLFS) in 2023-24.

The inaugural session of the workshop was graced by Shri Sanjeev Sanyal, Member- PM Economic Advisory Council, who in his key note address, emphasised the changing nature of informality in the economy due to digital penetration in various sectors. He highlighted the case of UPI payments, gig workers, social influencers, self-employment generated by digital intermediation platforms, yoga teaching to highlight the evolving landscape of economic transactions.

Dr. Saurabh Garg, Secretary Ministry of Statistics & Programme Implementation underscored the importance of robust estimation of the contribution of informal economy and efforts currently being undertaken by MoSPI in this direction. He highlighted that Ministry is exploring enhanced use of administrative data sources like GST & digital payment system and has also started preparation for Statistical Business Register. He informed that starting January,2025 monthly statistics on employment from Periodic Labour Force Survey and quarterly estimates for contribution of unincorporated (informal) sector through survey of unincorporated sector enterprises will be available. He urged the ministries/ departments to examine their administrative databases, which can supplement the survey-based estimates of informal economy and actively participate in the consultative exercise started by MoSPI in making the estimation of GDP robust in respect of informal economy. Secretary, MoSPI also highlighted various policy interventions of the Government to address challenges associated with informality.

• In the last 7 years, 7 crore people have transitioned to more secure, formal jobs as per EPFO.
• As per ILO’s World Social Protection Report 2024-26, India’s Social Protection coverage doubled from 24.4% to 48.8%.
• e-Shram Portal acts as one stop solution providing easy access to central and state government welfare schemes for over 300 million workers of unorganized sector.
• Pradhan Mantri Shram Yogi Maan-dhan (PM-SYM), a pension scheme for unorganized workers, was launched in February 2019 to ensure old age protection.
• Total gross enrolment under Atal Pension Yojana have crossed 7 crore mark in October,2024.

There were technical sessions on data sources and methodology being used in compilation of Gross Value Added (GVA) in National Accounts Statistics. The industries such as Agriculture & Allied activities, certain manufacturing activities, construction, trade, road transport, hotel & restaurants, personal services were highlighted as having high informality. Key aspects of Annual Survey of Unincorporated Sector Enterprises (ASUSE), which is a regular annual survey conducted by MoSPI since 2021-22 is a major source for measuring economic activity- wise productivity in informal sector. A presentation was made by Ministry of Textiles highlighting the informal nature of economic activities in Textile Industry and available administrative and survey-based data sources.

The consultation was attended by representatives from various Government Ministries & Departments, Research Institutions and Industry Associations & officers of MoSPI. The participants of the discussion supported the initiative of MoSPI to augment survey data with administrative data sources. Discussions veered around exploring databases like PM Street Vendor’s AtmaNirbhar Nidhi (PM SVANidhi), Pehchan Cards to artisans (handicrafts), data on workers available with organizations such as Tea Board, Coffee Board, State Construction Boards, District Industry Centres, availability of district level estimates from ASUSE, capturing seasonal activities through surveys, measuring digital economy through ASUSE and input output framework, improving coverage of informal sector in Education, improving coverage of gig economy, social influencers, use of alternate sources of data like remote sensing and satellite data.

Secretary, MoSPI invited research institutions, academia and industry associations, to take up studies on topics pertaining to alternate data sources and methodological improvements floated by MoSPI. Through such series of discussions, the Ministry has taken steps towards realizing the goal of Viksit Bharat by robust estimation of GDP.

Estimation of informal sector: MoSPI advances administrative data integration and methodological reform for improved GDP measurement. Estimation of the informal sector in GDP is being revised through methodological enhancements and integration of administrative and alternative data sources-GST, digital payments, PM SVANidhi, Pehchan Cards, sectoral boards and remote sensing-to supplement surveys. MoSPI will expand monthly employment statistics from the Periodic Labour Force Survey and use quarterly ASUSE estimates to better capture unincorporated activity; it plans a Statistical Business Register and invited stakeholders to provide administrative databases and undertake studies to improve coverage of seasonal activities, the digital economy, gig work and productivity measurement in informal enterprises.