NEW DELHI: The informal sector, which constitutes major part of the economy, registered robust growth in Q1 (April -June) of the current financial year as number of establishments in the sector grew 9% (y-o-y) to 8.7 crore from around 8 crore in the corresponding period last year, according to official data.The vast non-agriculture informal sector, which provides livelihood to the majority of Indians, also saw employment rise 7% to 13.7 crore in April-June, with the share of women rising to nearly one-third of the total workers.This comes amid concerns over rising cost of essential commodities, such as fuel and food due to prolonged crisis in West Asia impacting the small businesses. Urban areas outperformed rural areas on both counts. While number of establishments in urban areas grew 15% to 4.2 crore from 3.7 crore, number of people employed grew 12% to 7.4 crore.The other services sector recorded the highest growth among all sectors, with both establishments and employment increasing by nearly 21% (see graphic).
India’s informal sector expands 9% to 8.7 crore establishments in Q1, while employment rises 7% to 13.7 crore, official data shows
When compared sequentially, the unincorporated sector saw a decline. In Jan-March quarter of 2025-26, there were 9.2 crore unincorporated establishments employing 15.1 crore workers. The survey by NSO covers those non- agri unincorporated enterprises, which are not incorporated under either Companies Act, 1956 or Companies Act, 2013 and are usually run by small self-employed workers. The bulletin also noted that more and more of these informal enterprises are now going digital and using the internet.
