Abstract
India's economy has a large informal sector, which is generally associated with low labour productivity and poverty in the country. India became the first country to recognize the innovative ability of the informal sector and support it. Grassroots innovations scouted in various parts of India are now provided a complete cycle of support and integrated into the formal sector through networking cooperation with research institutions, businesses and governmental organizations at various levels. This article traces the genesis of the system of support for grassroots innovation in India through the institutionalization of the innovative activity of the informal sector. The specifics of this process can be taken into consideration by countries wishing to unleash the innovative potential of the informal sector.
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