Inside Dharavi's billion-dollar economy: The 'Gutter of Gold' powering Mumbai's informal sector

Mumbai's Dharavi, often viewed through the lens of deprivation, is also one of the city's most active economic zones. Spread across just about 2.4 sq km and home to nearly 1.2 million people, the settlement hosts more than 20,000 micro-enterprises and generates an estimated $1-1.5 billion annually, according to global development agencies.

Despite poor infrastructure, commercial rents here can reach ₹5 lakh a month. While residential shanties rent for ₹3,0000-₹7,000 for about 100 sq ft, larger commercial spaces 1,200 1,800 sq ft command rents in lakhs due to proximity to arterial roads and dense business activity. Dharavi's informal economy supports blue-collar workers across sectors from domestic help and drivers to craftsmen, recyclers and food vendors many of whom power Mumbai's daily operations.

Raju Hanumanta, a plumber born here and working in Dharavi, says, "Gutter hai, par sone ka hai (It's gutter, but it's made of gold)".

Micro-industries driving a billion-dollar ecosystem

Dharavi's leather trade remains a cornerstone, with over 5,000 small manufacturers producing bags, jackets, saddles and accessories for domestic and export markets. The Koliwada Road leather belt alone is estimated to generate around ₹250 crore annually. Artisans typically earn thin margins of ₹200-₹300 per product but maintain steady output tied to global supply chains.

Kumbharwada, Asia's largest pottery hub, supports over a thousand families and generates business worth more than ₹1,000 crore annually through diyas, crockery and decorative items. Seasonal cycles, health risks from kiln smoke and lack of formal infrastructure remain key challenges.

Street food is another major economic layer. Idli, vada and filter coffee units begin operations before dawn, supplying vendors across Mumbai. Though unquantified, this network forms a crucial part of Dharavi's supply chain.

Recycling hub and redevelopment concerns

Dharavi's scrap economy processes nearly 80% of Mumbai's solid waste around 20,000 tonnes daily handled by an estimated 2.5 lakh ragpickers and dealers. Recycled material feeds manufacturing units producing pipes, bags and other goods.

As redevelopment begins, uncertainty looms. Many residents fear displacement or ineligibility in resettlement plans, while business owners worry about losing customer access if units are relocated. Yet the settlement's economic resilience remains clear, a dense network of labour, manufacturing and trade continues to sustain Mumbai's informal backbone despite limited state support.

(With inputs from Anand Singh)