Knife & Fork Dosa

And Other Delusions of Progress

India is formalizing. And yet, it remains profoundly informal. We toss around terms like “formality” and “informality” to describe economic activity—but do we even know what they really mean? Over 85% of India’s workforce is considered “informally employed”, but when something accounts for the overwhelming majority of how a system functions, maybe it’s not the exception. So why does formality matter? And more importantly, is it even definable?

In the Western lexicon, “formality” implies structure, regulation, and legitimacy. It’s framed as a kind of progress—a journey from chaos to order, from the unorganized to the organized. “Informality,” by contrast, is seen as a deviation: temporary and messy, impoverished and backward—in need of an upgrade. That’s a narrow, very linear (and limited) view of the world. Who promised linearity in the first place?

Is a business formal because it has a GST number? Because it pays taxes? Uses a QR code? Ola is formal—but what about its drivers? Like gig workers everywhere, they exist in a gray zone: not quite employees, not quite independent. But in India, that ambiguity is layered over a labor market where protections are scarce and informality is the norm. A kirana shop might have a POS terminal, yet still run on local credit and trust. A factory might have all its licenses and still pay workers off the books. Formality feels less like a binary classification and more like a spectrum—a patchwork stitched together in the margins. It’s not about structure so much as visibility to the state, and visibility doesn’t always mean protection, stability, or legitimacy. That’s the paradox: what appears formal on paper may not be in practice, and what seems informal might actually function more effectively than we expect.

So what does "formalization" actually mean? Does it mean eating dosa with a knife and fork?

The Western lens often tries to impose linearity and familiarity onto systems that are fundamentally non-linear—systems that loop and adapt as a matter of design. When these systems resist being easily mapped or measured, they’re often misread as dysfunctional.

If we can accept that India is a place that is at once ancient and modern, improvisational yet precise, disparate and cohesive, then perhaps its informality isn’t a flaw to be fixed and it’s the very quality that makes it work. That doesn’t mean systems can’t or shouldn’t evolve—they can and they will—but there’s a difference between fixing something as opposed to improving it, and that’s a nuanced distinction that often gets lost. And while I wholly cringe at the cliché, it fits here: informality is a feature, not a bug.

To developmental economists, "informality" often feels like a dirty word. But informal systems—whether social, economic, or digital—aren’t primitive, nor are they necessarily temporary. They’ve been optimized over time to handle volatility and risk.

Nassim Taleb would call these systems antifragile: not merely robust in the face of shocks but actually improved by disorder. They absorb stress, reroute around disruption, learn, and recalibrate. As opposed to completely breaking they bend, flex, and can often emerge stronger and wiser in the face of a monsoon, a supply chain crisis, or a pandemic lockdown. Systems built on trust, redundancy, and adaptation snap into motion without waiting for central-level policy memos. In a world that faces such great uncertainty on every front imaginable, which societies will be best prepared not only to handle external shocks but also to respond and adapt to them before they reach a breaking point?

Visit any wholesale mandi or bazaar in Surat, Madurai, or Rajkot and you’ll see intricate networks and transactions governed not by paperwork, but by trust and relationships. Goods move in bulk without invoices. Prices adjust on the phone in real time. Credit is extended based on a nod. Logistics are coordinated via WhatsApp, not ERPs. Despite the ubiquity of digitization, it isn’t creating order in the Western sense, it’s actually supercharging informality. WhatsApp is the CRM. YouTube is where skills are learned and taught. UPI functions like a digital khata. Digitization here doesn’t conform to traditional ideas of structure—it strengthens decentralized, intuitive, and informal systems.

This isn’t dysfunction. It’s what Dee Hock—founder of Visa—describes as a chaordic system: part chaos, part order. These systems aren’t centrally controlled or totally anarchic—they’re alive with intelligence at the edge. They scale without hierarchy and operate without top-down control.

However well-functioning these systems are, they face a threat to their continued existence: the danger of over-monetization. Hock believed that by reducing everything to a monetary value, we destroy value. Not just economic value, but human and community value. When goods are extended on credit and services are bartered the relationship, not the contract, underpins trust. These are non-monetary exchanges of value—and Hock believed they were essential to a functioning society—try monetizing every relationship in your life and see how fast they break.

What happens when we measure worth only in Rupees? We lose sight of the community capital, natural capital, and social resilience that can’t be priced and we start assuming that value only exists when it's visible to capital providers. We begin designing systems that erase—rather than enhance—what already works. Systems that are not easily quantified and that don’t show up in dashboards are seen as flawed, risky, and therefore unpriceable by investors.

India’s informal systems haven’t endured for centuries because they were waiting to be fixed. They’ve endured because they solve problems and adapt to complexity instead of resisting it, and they do so without reducing people to economic units or commodifying every transaction. In Hock’s view, monetized systems risk making people invisible—seen only as means to an end, not ends in themselves. In India’s informal economy, people remain visible through relationships, reputation, and reciprocity—just look at how microfinance joint liability groups (JLGs) underwrite based on social capital.

Anyone trying to develop a thesis on India has to start with this understanding. Non-linearity isn’t the exception—it’s the rule. Humility is required to interpret it. Western frameworks prize legibility, scale, and order, so investors seek solutions that impose order—but by favoring only what looks familiar we miss the action in the margins. This distorts how capital gets allocated, and we chase formality not because it’s more valuable, but because it’s more visible. Progress therefore is subjective; in lending, for instance, it often looks like pulling people into formal frameworks that were never designed to underwrite them in the first place.

Countries are often compared to one another based on perceived stages of development, but India is not a “failed” version of the West—nor is it 20, 50, or 100 years “behind” some imagined global timeline. Perhaps its collected wisdom places it ahead. Or maybe it’s simply on a different arc altogether existing in a time and space that’s unfamiliar to those not attuned to its rhythms. Mumbai isn’t a chaotic New York with poor infrastructure, and Delhi isn’t Washington DC with more pollution. These aren’t incomplete copies, they are rich with history, layered with logic, and built for time and scale. To mistake them for knockoffs is to miss the genius of adaptation—and to misunderstand the future. India isn’t catching up, it’s just carving its own path. Until we recognize this, we’ll keep misreading the signals and imposing linear maps onto circular terrain.

*On a Lighter Note: A Cautionary Tale
In 2014, then New York City Mayor Bill de Blasio was photographed eating pizza with a knife and fork at Goodfellas on Staten Island. #Forkgate erupted, upsetting the sensibilities of New Yorkers everywhere. As a native son of Brooklyn—and a regular at Udupis and Darshinis far and wide—this one hits a little too close to home.

This is how trust in public institutions erodes