INDUSTRIES

There are three types of economic activities. These are:

1. Primary Activities: Connected with extraction and production of natural
resources like forestry, agriculture, mining, animal husbandry, etc.
2. Secondary Activities: Connected with processing and manufacturing. They get
raw material from the Primary sector. When the primary product is processed
into a secondary product, its utility and value is increased.
3. Tertiary Activities: Provides support to Primary and Secondary sectors
through services, e.g. transportation, banking, tourism, etc.

MANUFACTURING: Production of goods in large quantities after processing

from raw material to more valuable products is called "Manufacturing".
Secondary activities or manufacturing change raw materials into products of
more value to people. As you have seen pulp was changed into paper and paper
into a note book. These represent the two stages of the manufacturing process.
The paper made from pulp and cloth made from cotton have had value added to
them at each stage of the manufacturing process. In this way the finished product
has more value and utility than the raw material that it is made from

INDUSTRY: Industry refers to an economic activity that is concerned with the

production of goods, extraction of minerals or the provision of services.

THE ECONOMIC STRENGTH OF A COUNTRY IS MEASURED BY THE

DEVELOPMENT OF MANUFACTURING INDUSTRIES.

Q. Why manufacturing sector is considered as the economic backbone of a

country?
Ans: -Industrial growth helps in modernising the agricultural activities by
providing machinery, chemicals, irrigation facilities, insecticides, pesticides, etc.
Industrial growth helps in reducing the unemployment and poverty.
Industrial growth can earn foreign exchange by exporting the finished goods and
thus, can expand its trade and commerce.
INDUSTRIAL LOCATION
Factors effecting the location of an Industry are: -

The factors affecting the location of industries are the availability of raw
material, land, water, labour, power, capital, transport and market. Industries
are situated where some or all of these factors are easily available.
Industrialisation often leads to development and growth of towns and cities.
Industrialization leads to urbanization.
Government policies also play a key factor in deciding the location of an
industry. The government provides incentives like subsidised power, lower
transport cost and other infrastructure so that industries may be located in
backward areas.

Industrial location factors

Different industries require different inputs. Industries are more likely to locate
where these inputs are readily and cheaply available. Factors that influence
where an industry locates include:

1. Raw Materials
Raw materials are the inputs to a factory system. The factory processes these
raw materials into the finished product which is then sold to market. Factories
usually locate close to the source of their raw materials. This is because the cost
of the raw material includes the cost of transporting it to the factory. By
locating close to the raw material, a factory can reduce the cost of
manufacturing its products. This is especially the case for heavy industries
which use bulky (takes up a lot of space), expensive-to-transport raw materials.
If the finished product is bulkier than the raw materials, a factory will locate
close to its market to reduce the transport cost of the finished product.
2. Labour
Labour is the workers in a factory. All factories depend on labour. Some
factories use low-skilled labour and others used highly skilled, specialist
workers. The largest number of workers live in or near towns. Therefore,
factories locate near to towns and cities, often in industrial estates, to be close
to workers. Factories owners like to keep the cost of their labour (wages and
salaries) as low as possible. Therefore, they might locate in a country where
wages are low. However, if a factory needs highly skilled workers, the factory
might change location to access the skilled labour they need.
3. Markets
“Market’ the term used to describe all the shops and other places where
manufactured goods are sold. All finished products need to be transported to
market. Therefore, factories often locate close to their market so that the cost
of transporting the finished product is reduced. For most factories, this means
locating near a town or city. If the factory is exporting its finished product, it
may locate near a port or airport so as to access foreign markets easier.
4. Transport
All factories use transport networks to access their raw materials and to get
their finished products to market. Factories need quick, efficient transport so as
to lower the cost of transporting their goods. This means most factories locate
near to major transport routes. This includes railways, motorways, ports and
airports. Factories can choose which transport routes to locate near depending
on their raw materials and on what they manufacture. Heavy industry often
locates near a sea port where there is plenty of land to store raw materials
delivered by ship. Light industry may locate near a motorway or an airport for
quicker transport.
5. Capital
‘Capital’ is another word for ‘money’. In the past, factories often located near
cities so that they could more easily access banks. This made it easier to borrow
money to help finance the running of the factory. Today, with modern internet
banking, it is easier for factories to locate in other places without needing to be
near a bank.
6. Government Policies
A ‘policy’ is a rule or guideline used to help people make decisions. The Irish
government has a strong policy of encouraging foreign companies to locate in
Ireland. The government provides grants to these companies if the locate in
certain places. This helps bring employment to these locations. The government
policy also provided industrial estates just outside towns where factories could
locate. Some government policies restrict or stop factories from locating in
certain places. For example, a chemical factory would not get planning
permission to locate in a housing estate.
7. Personal Preference
Often, a factory will be located in a place simply because the owner has a
connection with that place. The owner might live there or have some other
family connection. For example, Henry Ford’s grandfather came from Cork. So
when Ford Motor Company was setting up in Ireland, it chose to locate its
factory in Cork.

Agglomeration and footloose industries

These are two 'special cases' of industrial location.

Agglomeration is when a number of producers in the same or related industries

group themselves together. They do this to benefit from local skill pools,
economies of scale or the prowess of a locality in a particular field. An example
is the large number of financial services companies (eg banks and insurance
companies) which are headquartered in the City of London.

Footloose industries are those that are less dependent on factors that tie them
to a specific geographical location. Unlike manufacturing industries, tertiary or
services, companies do not have to be near a source of raw materials. As long as
they have suitable transport, energy and communications links, they can locate
themselves virtually anywhere in the world. Examples of footloose industries
are computer software development, telephone sales and call centres.

INDUSTRIAL SYSTEM

An industrial system consists of inputs, processes and outputs.

Input: Raw materials, labour, costs of land, transport, power and other
infrastructure.
Process: All activities that convert the raw material into finished products.
Output: End/ Final/Finished product and the income earned from it.

CLASSIFICATION OF INDUSTRIES
1. On the basis of Raw Materials: These types of industries are classified
depending on the type of raw materials they use.
(a) Agro Based Industries: Use plant and animal-based products as their raw
materials. E.g. Food processing, vegetable oil, cotton textile, dairy products, etc.
(b) Mineral Based Industries: Primary industries that use mineral ores as their
raw materials. The products of these industries feed other industries. Iron made
from iron ore is the product of mineral based industry. E.g. Iron& Steel, Cement,
Machine Tools, etc.
(c) Marine Based Industries: Use products from the sea and oceans as raw
materials. E.g. processed sea food, fish oil manufacturers, etc.
(d) Forest Based Industries: Use forest produce as raw materials. E.g. pulp &
paper, furniture. Pharmaceuticals, etc.

2. On the basis of Size: These types of industries are classified depending on the
amount of capital invested, number of people employed and the volume of
production.
(a) Large Scale Industries: In India, on an industry, if the capital invested is
more than 1 crore, then it is called Large Scale Industry. E.g. Iron & Steel
Industries, Automobile Industries, etc.
(b) Small Scale Industries: In India, on an industry, if the capital invested is less
than 1 crore, then it is called Small Scale Industry. E.g. Silk weaving, Food
processing industries, etc.
Cottage or household industries are a type of small-scale industry where the
products are manufactured by hand, by the artisans with the help of family
members. E.g. Basket weaving, pottery, handicrafts, etc.
3. On the basis of Ownership: These types of industries are classified on the
basis of ownership.
(a) Private Sector Industries: Owned and operated by individuals or a group of
individuals. E.g. Bajaj Auto, Reliance, etc.
(b) Public Sector Industries: Owned and operated by the government. E.g.
Hindustan Aeronautics Limited (HAL), Bharat Heavy Electronics Ltd. (BHEL), SAIL,
etc.
(c) Joint Sector Industries: Owned and operated by the state and individuals or
a group of individuals. Maruti Udyog Limited. E.g. processed sea food, fish oil
manufacturers, etc.
(d) Co-operative Sector Industries: Owned and operated by the producers or
suppliers of raw materials, workers or both. E.g. IFFCO, Anand Milk Union
Limited (AMUL) and Sudha Dairy, etc.

DISTRIBUTION OF MAJOR INDUSTRIES

The world's three major industries are:
1. Iron & Steel Industry
2. Textile Industry
3. Information Technology Industry
The iron & steel and textile industry are the older industries while information
technology is an emerging industry.
EMERGING INDUSTRIES ARE ALSO KNOWN AS 'SUNRISE INDUSTRIES'

IRON & STEEL INDUSTRY:

• This is basic industry.
• These industries are the feeder industry whose products are used as raw
material for other industries.
• Inputs: Raw materials such as iron ore, coal and limestone, along with
labour, capital, site and other infrastructure.
• Process: Converting iron ore into steel involves many stages. The raw
material is put in the blast furnace where it undergoes smelting and then
it is refined.
 • Output: Steel is obtained which is used by other industries as raw
material.
• Steel is often called the backbone of modern industry.
• Almost everything we use is either made of iron or steel or has been
made with tools and machinery of these metals. From safety pin to
Ships, trains, trucks, and autos are made largely of steel.
• Iron and steel industry were located where raw materials, power supply
and running water were easily available.
• India, Germany, USA, China, Japan, Russia, Korea, etc. are the countries,
where steel industries are located.
• In India important steel producing centres are: Bhilai, Durgapur, Burnpur,
Jamshedpur, Rourkela, Bokaro are situated in a region that spreads over
four states — West Bengal, Jharkhand, Odisha and Chhattisgarh.
• Bhadrapada in Karnataka, Vishakhapatnam in Andhra Pradesh, Salem in
Tamil Nadu are other important steel centres utilising local resources.

Tata Iron and Steel Industry in Jamshedpur:

• Before 1947, there was only one iron and steel plant in the country –
Tata Iron and Steel Company Limited (TISCO).
• It was privately owned.
• TISCO was started in 1907 by Jamshedji N. Tata at Sakchi in the
Singhbhum district of Jharkhand, but the production started in 1910.
Later on, Sakshi was renamed as Jamshedpur.
Sakchi was chosen to set up the steel plant because of the following reasons: -
1. This place was only 32 km away from S Eastern railway line.
2. It was close to the iron ore, coal and manganese deposits as well as to
Kolkata, which provided a large market.
3. TISCO gets coal from Jharia coalfields, and iron ore, limestone, dolomite and
manganese from Orissa and Chhattisgarh.
4. The Kharkai and Subarnarekha rivers ensured sufficient water supply.
5. Government initiatives provided adequate capital for its later development.
This led to rapid industrial growth in India.
Iron and Steel Industry at (USA):
Pittsburgh is also known as "Iron City". Detroit is another important centre
producing iron and steel.
In mid-19th century processing of Iron began.
The steel industry in USA enjoys locational advantages. Some of the raw
material such as coal is available locally. Between these mines is one of the
world's best routes for shipping ore cheaply – the famous Great Lakes
waterway. Trains carry the ore from the Great Lakes area.
The Ohio, the Monongahela and Allegheny rivers provide adequate water
supply.
The Geographical here provide a favourable topography, temperate climate,
skilled labour and market, which make this place favourable for the
development of Iron & Steel industry.

TEXTILE INDUSTRY:
• Weaving cloth from yarn is an ancient art and it is done on looms.
• Hand operated looms are called Handlooms and power operated looms
are called Powerlooms.
• Cotton, wool, silk, jute, flax have been used for making cloth.
• The textile industry can be divided on the basis of raw materials used in
them.
• Fibres are the raw material of textile industry.
• Fibres can be natural or man-made. Natural fibres are obtained from
wool, silk, cotton, linen and jute. Manmade fibres include nylon,
polyester, acrylic and rayon.
• The cotton textile industry is one of the oldest industries in the world.
• The first successful mechanized textile mill was established in Mumbai in
1854.Ÿ
• the warm, moist climate, a port for importing machinery, availability of
raw material and skilled labour resulted in rapid expansion of the industry
in the region.
 • Initially this industry flourished in the states of Maharashtra and Gujarat
because of favourable humid climate.
• Today, Coimbatore, Kanpur, Chennai, Ahmedabad, Mumbai, Kolkata,
Ludhiana, Pondicherry and Panipat are some of the other important
centres.

INFORMATION TECHNOLOGY (IT):

• Today, IT industry has become global and has become the fastest growing
industry in the world.
• The information technology industry deals in the storage, processing and
distribution of information through Radio, Television, Telephones,
Cellular Phones, Computers, Laptops, etc.
• Availability of resources, cost and infrastructure are the main factors
responsible for the location of an IT industry.
• The major hubs of the IT industry are the Silicon Valley and Bengaluru in
India.
• Other emerging information technology hubs in metropolitan centres of
India such as Mumbai, New Delhi, Hyderabad and Chennai, Gurgaon,
Pune, Thiruvanthapuram, Kochi and Chandigarh, etc.

Questions
1. Define industry.
Answer: Industry refers to an economic activity that is concerned with
production of goods, extraction of minerals or provision of services.

2. Describe briefly the classification of industries on basis of ownership.

Answer: On the basis of ownership, industries are classified into private sector,
state owned (public sector), joint sector and cooperative sector.
Private sector industries are owned by individuals or a group of individuals.
Public sector industries are owned by the government.
Joint sector industries are owned and operated by the state and individuals.
Maruti Udyog is an example of such an industry.
Cooperative sector industries are owned and operated by the producers or
suppliers of raw materials, workers or both. AMUL is one such industry.
5. What factors supported Sakchi being chosen to set up the steel plant by
TISCO
Answer: Sakchi was chosen for various reasons.
It was close to the Railway Station.
It was also close to iron ore, coal and manganese deposits.
Kolkata, a source of large market, was not far away.
Jharia coal fields, and limestone, dolomite, limestone and manganese from
Orissa and Chhattisgarh were easily accessible.
The nearby rivers (Kharkai and Subarnarekha) provided water supply.

6. Which industry is often referred to as the backbone of modern industry and

why?
Ans: Iron and steel industry is often referred to as the backbone of the modern
industry because of the following reasons:
1. Almost everything is either made from iron or steel has been made using
tools and machinery made of these metals.
2.There are plenty of examples like-ships, trains, vehicles; all are made largely of
steel.
3.Iron and Steel industry is the axis of modern industrial and economic
development. It is considered to be base industry.
4.Materials of our day-to-day use starting from the safety pin to our building in
which we live, are made from steel.
Without the use of iron, no industry can run.
Distinguish between the following