India is probably unique in the world in the size and significance of her informal economy. While the concept has been much criticised by academics1,‘informality’ refers to the vital reality of unregistered activity that is not regulated either by the state or necessarily according to its law. It is well understood by the public and thus has sufficient conceptual traction to have needed the attention of planners. In this paper, using the insights of recent research2, I will cover its roles and their implications for policy and planning. Structure and relations First, the informal economy (IE) is not transitory. The concept was developed (for conditions in West and East Africa) in the 1970s when it was expected that unregistered activity would be rapidly subsumed under the formal, nation-building processes of industrialisation (including that of agriculture), urbanisation and banking. With the passage of the ‘development decades’, it became clear that the IE was hard-wired into the structure of many economies in which formal registered activity not only directly exploited the IE through subcontracting but also gained from the cheap products and services it generated. Latterly, the ubiquity of informal (unregistered) wage labour3 has expanded the scope of the concept, even while it was being criticised.