Informal Economy in India: Key Findings of ASUSE 2025 District-Level Data

MoSPI’s ASUSE 2025 provides India’s first district-level informal economy estimates, highlighting women’s participation, wages, entrepreneurship and regional disparities.

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The Ministry of Statistics and Programme Implementation (MoSPI) has released the first-ever district-level estimates of India’s informal economy, based on the Annual Survey of Unincorporated Sector Enterprises (ASUSE) 2025.

The data provides a granular picture of India’s unincorporated non-agricultural sector, covering enterprises involved in manufacturing, trade and other services. It highlights major differences across districts in employment, women’s participation, enterprise ownership, wages and economic output.

The estimates cover 757 districts and can help policymakers design more targeted interventions for employment, entrepreneurship, skilling, credit and social protection.

What is the Informal Economy?

The informal economy consists of economic activities and enterprises that generally operate outside the formal institutional framework and may have limited access to formal credit, social security and labour protections.

In India, the unincorporated non-agricultural sector includes a large number of small businesses and establishments engaged in:

Manufacturing
Wholesale and retail trade
Services
Other non-agricultural economic activities

The sector is an important source of employment and livelihoods, particularly for workers and small entrepreneurs.

Key Findings of ASUSE 2025

1. Wide Variation in Women’s Participation

One of the most significant findings is the large geographical variation in the share of women among informal workers.

The districts with the highest female participation include:

Nirmal, Telangana – 78%
Imphal East, Manipur – 70%
Nizamabad, Telangana – 70%
Jagtial, Telangana – 69%
Bishnupur, Manipur – 66%

At the other end, female participation is particularly low in districts such as Rudraprayag, Uttarakhand (7%), Marigaon, Assam (9%), and Srinagar, J&K (11%).

The national average is around 29%, while women account for at least one-third of the informal workforce in 237 districts.

2. High Participation Does Not Always Mean Higher Wages

ASUSE 2025 also highlights the importance of looking beyond employment numbers.

Among districts where women constitute at least half of the informal workforce, South West Khasi Hills in Meghalaya records annual emoluments of around ₹1.71 lakh per hired worker, compared with an all-India average of approximately ₹1.3 lakh.

This demonstrates that policymakers need to focus not only on increasing women’s participation but also on improving the quality, productivity and remuneration of employment.

3. Women’s Enterprise Ownership

The data indicates a close relationship between women’s participation in informal employment and women-owned proprietary establishments.

Nirmal district in Telangana, which has the highest female share of informal workers, also has nearly 80% of proprietary establishments owned by women.

This suggests that in some parts of India, women are participating in the informal economy not merely as workers but also as entrepreneurs and enterprise owners.

Greater access to formal credit, digital tools, skills, technology and markets can help these women-led enterprises expand and transition towards greater formalisation.

4. Informal Economic Activity Is Highly Concentrated

The geographical distribution changes significantly when informal activity is measured by the absolute number of workers and establishments rather than the share of women workers.

North 24 Parganas in West Bengal has the largest number of informal workers, with approximately 21.3 lakh workers, and around 16.6 lakh establishments.

The concentration is also visible in economic output:

The top 10 districts by number of establishments account for around 11% of the sector’s GVA.
The top 50 districts contribute nearly one-third of the sector’s GVA.

Thus, India’s informal economy combines two different patterns: high female participation in several eastern and northeastern districts, and concentration of overall economic activity in a relatively smaller group of districts across the country.

Why District-Level Informal Economy Data Matters

Earlier, much of the discussion around India’s informal economy relied on national or broader regional estimates. District-level data provides a much more detailed understanding of local economic conditions.

It can help governments identify districts that require targeted interventions related to:

Women’s employment
Skill development
Entrepreneurship
Access to institutional credit
Digitalisation
Market access
Social security
Productivity enhancement

Such granular data can support evidence-based policymaking and allow government programmes to be better aligned with local economic realities.

Challenges of the Informal Economy

Despite its importance, the informal economy faces several structural challenges:

Limited access to formal finance
Low productivity in many enterprises
Inadequate social-security coverage
Limited access to technology and digital markets
Vulnerability of workers to economic shocks
Gender disparities in employment and earnings
Difficulty in transitioning small enterprises towards formalisation

Therefore, policy should focus not only on formalisation but also on improving the productivity, incomes and resilience of informal enterprises and workers.

Conclusion

The first district-level estimates from ASUSE 2025 provide a more nuanced picture of India’s informal economy. They reveal substantial inter-district differences in women’s participation, enterprise ownership, wages and economic concentration.

The findings underline the need for locally tailored policies that combine job creation with better wages, entrepreneurship opportunities, access to finance, and social protection.

For India to achieve inclusive and women-led growth, improving the quality and productivity of informal economic activity will be as important as increasing participation itself.