Informal economy 64% larger than formal: study

The Federal Additional Secretary of Industries and Production, Asad Islam Mahni, has stated that, according to a conservative estimate, the total size of Pakistan’s informal economy is projected to be around $457 billion. The size of the country’s formal economy, as per official statistics, was $340 billion in 2023. This translates into almost 64% less than the size of the informal economy of Pakistan. This study was revealed in a consultative workshop held on Thursday to lay down the national action plan for the formalisation of Small and Medium Enterprises (SMEs). The study has been jointly organised by the Small and Medium Enterprises Development Authority (SMEDA) and the International Labour Organisation (ILO), titled ‘Mapping of Barriers and Opportunities to Reduce the Informality of Enterprises in Pakistan’.