Manufacturing Industries – Introduction and Classification

  • The process of using raw material to produce more valuable goods in large quantities is called manufacturing. Industries that manufacture finished products from primary material are called manufacturing industries in the secondary sector.
  • Manufacturing industries play a crucial role in the overall, and especially the economic development of a country. A country’s economic strength is measured by the growth of its manufacturing industries.
  • Manufacturing sector is considered the backbone of development in general and economic development in particular.
  • Manufacturing industries help in modernising agriculture, which forms the backbone of our economy, and reduce the heavy dependence of people on agricultural income by providing them jobs in secondary and tertiary sectors.
  • Industrial development is necessary for eradication of unemployment and poverty from our country.
  • Export of manufactured good expands foreign trade and commerce and brings in much needed foreign exchange.
  • India’s prosperity lies in increasing and diversifying its manufacturing industries as quickly as possible.
  • India is traditionally an agricultural country. The growth in manufacturing industries has not only modernised farming, but also generated a large number of employment opportunities. This has reduced the dependence of people on agriculture , allowed us to export our goods to other countries and build up our reserves of foreign exchange and hence led to overall growth and prosperity. Agriculture and industry mutually benefit each other.
  • The agro-based industries in India have given a major boost to agriculture by raising its productivity.
  • Industries depend on the agriculture secture for raw materials and sell their products such as irrigation pumps, fertilizers, insecticides, pesticides, plastic and PVC pipes, machines and tools, etc. to the farmers.
  • Over the last two decades, the share of manufacturing sector has stagnated at 17 per cent GDP.
  • The National Manufacturing Competitiveness Council (NMCC) has been set up to improve productivity.

Location and Classification

  • The key factor in influencing all decisions about setting up a manufacturing industry, including its location, is the low cost. The main cost in a manufacturing industry are of procuring raw material, producing goods and distributing finished goods in the market.
  • The ideal location for a factory will be a place that has easy and low-cost availability of raw material, capital, land, labour, power, transport, and market.
  • A manufacturing industry promotes the urbanisation of its neighbourhood. Already urbanised areas also attract industries, since they provide ready facilities for transport, banking, labour , consultancy, etc.
  • If an urban centre offers sufficient facilities and advantages, several industries come up there together to form an industrial agglomeration. These industries together form an agglomeration economy.
  • Before independence, most industries in India were located in port cities to enable easy overseas trade.
  • Manufacturing industries are classified based on their source of raw material, their main role, capital investment, owenership pattern, and bulk and weight raw material and finished products.

Classification of Industries

Industries can be classified into several groups. A brief account is given below:

On the basis of labour :

i) Large-scale Industries

ii) Medium

iii) Small

On the basis of bulk and weight of raw material and finished goods:

i) Heavy Industries

ii) Light Industries

On the basis of ownership:

i) Private Sector Industries

ii) Public Sector Industries

iii) Joint Sector Industries

iv) Cooperative Sector Industries

On the basis of source of Raw Material:

i) Agro Based Industries

ii) Mineral Based Industries

iii) Forest Based Industries

Miscellaneous Industries

The industries are also classified into the following categories:

i) Village Industries

ii) Cottage Industries

iii) Consumer Industries

iv) Ancillary Industries

v) Basic Industries

vi) Capital Intensive Industries

vii) Labour Intensive Industries

Large Scale Industries

Industries which employ a large number of labour in each unit. Example : Cotton textile industry.

Public Sector Industries : Industries which are owned and operated by government agencies. e.g. BHEL.

Agro-Based Industries : Industries which obtain raw materials from agricultural products. e.g. Sugar Industry.

Mineral-Based Industries : Industries that use minerals and metals as raw materials. e.g. Iron and Steel Industry.

Basic Industries : Industries on which depend many other Industries for their manufacturing processes. e.g. Iron and Steel Industry.

Agro-based Industries

  • Manufacturing  industries that use agricultural products as raw material are called Agro-based Industries.
  • Cotton, jute, silk, woollen textiles, sugar and edible oil, etc. industries are based on agricultural raw materials.
  • The textile industry occupies unique position in the Indian economy, it contributes significantly to industrial production (14 per cent), employment generation (35 million persons directly – the second largest after agriculture) and foreign exchange earnings (about 24.6 per cent). It contributes 4 per cent towards GDP.
  • In ancient India, cotton textiles were produced with hand and handloom weaving techniques.
  • The first successful textile mill was established in Mumbai in 1854.
  • Initially, the cotton textile industry was concentrated in the cotton growing belt of Maharashtra and Gujarat.
  • Availability of raw cotton, market, transport including accessible port facilities, labour, moist climate, etc. contributed towards the localization of cotton textile industry.
  • While spinning continues to be centralized in states of Maharashtra, Gujarat and Tamil Nadu, weaving is highly decentralized to provide scope for incorporating traditional skills and designs of weaving.
  • The handsupn khadi provides large scale employment to weavers in their homes as a cottage industry.
  • India exports yarn to Japan and other cotton goods to U.S.A., U.K., Russia, France, East European countries, Nepal, Singapore, Sri Lanka, and African countries.
  • India has the second largest installed capacity of spindles in the world , after China.
  • Indis is the largest producer of raw jute and jute goods and stands at second place as an exporter after Bangladesh.
  • Factors responsible for their location in the Hugli basin are as follows:

i) Proximity of the jute producing areas,

ii) Inexpensive water transport, supported by a good network of railways, roadways and waterways to facilitate movement of raw material to the mills,

iii) Abundant water for processing raw jute,

iv) Cheap labour from West Bengal and adjoining states of Bihar, Odisha and Uttar Pradesh.

v) Kolkata as a large urban centre provides banking, insurance and port facilities for export of jute goods.

  • Challenges faced by the jute industry includes: stiff competition in the international market from synthetic materials and from other competitors like Bangladesh, Brazil, Philippines, Egypt and Thailand.
  • National Jute Policy was formulated in 2005 with the objective of increasing productivity, improving quality, ensuring good prices to the jute farmers and enhancing the production per hectare.
  • The main importers of jute and its products are U.S.A, Canada, Ghana, Saudi Arabia, U.K. and Australia.
  • India is the second largest producer of sugar but occupies the first place in the production of gur and khandsari.
  • The raw material used in sugar industry is bulky, and in haulage its sucrose content reduces.
  • This industry is seasonal in nature so, it is ideally suited to the cooperative sector.
  • In recent years, there is a tendency for the mills to shift and concentrate in the southern and western states, especially in Maharashtra, this is because:

i) The cane produced here has higher sucrose content.

ii) The cooler climate also ensures a longer crushing season.

iii) The cooperatives are more successful in these states.

  • Major challenges to sugar industries are as follows

 i) The seasonal nature of the industry,

ii) Old and inefficient methods of production,

iii) Transport delay in reaching cane to factories and

iv) The need to maximise the use of baggase.

Mineral-based Industries

  • Manufacturing industries that use minerals as raw material are called mineral-based industries.
  • The iron and steel industry is the basic industry on which all other  industries depend. The production and per capita consumption of steel is a measure of a country’s economic development.
  • The main raw materials used in the iron and steel industry are iron ore, coal and limestone.
  • The raw materials and finished products of iron and steel  industries are quiet bulky; these  industries must be located near the mining areas of the required minerals and must be connected by a good transport network.
  • India is the ninth largest producer of crude steel and the largest producer of sponge iron in the world. India is also a leading exporter of steel in the world.
  • The per capita consumption of steel in India is only 61 kilograms.
  • There are 10 primary integrated steel plants in India. These integrated plants handle all stages of steel produciton, from procurement of basic raw material to producing finished rolled and shaped steel.
  • India has many mini steel plants that produce customised alloy steel using scrap iron or sponge iron as raw material.
  • China has become the world’s largest producer and consumer of steel, leaving India for behind.
  • Most steel manufacturing industries are located in the Chota Nagpur Plateau region because of the availability of inexpenseive, high-grade raw material and abundant cheap labour.
  • The main challenges faced by the steel industry are as follows:

i) Realising its full potential

ii) Limited supply of expensive coking coal, erratic power supply, low output of labour and poor infrastructure.

iii) The future of India’s iron and steel industry is bright due to India’s liberalisation policy and foreign direct investment in the industry.

  • Automobiles provide vehicle for quick transport of goods and services and passengers. Trucks, buses, cars, motor cycles, scooters, three-wheelers and multi-utility vehicles are manufactured in India at various centres.
  • This industry had experienced a quantum jump in less than 15 years.
  • Foreign Direct Investmetn brought in new technology and aligned the industry with global developments.
  • At present, there are 15 manufacturers of passenger cars and multiutility vehicles, 9 of commercial vehicles, 14 of the two and three-wheelers.
  • The Automobiles industry is located around Delhi, Gurugram, Mumbai, Pune, Chennai, Kolkata, Lucknow, Indore, Hyderabad, Jamshedpur and Bengaluru.
  • The electronics industry covers a wide range of products from transistor sets to televison, telephones, cellular telecom, pagers, telephone exchange, radars, computers and many other types of equipment required by the telecommunication industry.
  • Bengaluru is known as the electronic capital of India.
  • The major software industries are concentrated at Bengaluru, Noida, Mumbai, Chennai, Hyderabad and Pune.
  • A major impact of software industry has been on employment generation. It is encouraging to know that 30 per cent of the people employed in software sector are women.
  • Sotware industry has been a major foreign exchange earner in the last two or three decades because of its fast growing Business Processes Outsourcing (BPO) sector.

Industrial Pollution and Environmental Degradation

  • Industries have caused severe pollution of our natural resources. Industries cause environmental degradation through four main types of pollution viz. air pollution, water pollution, land pollution or soil degradation, and noise pollution.
  • Smoke contains undesirable gases like carbon dioxide, sulphur dioxide and carbon monoxide, besides solid and liquid particulate matter, in the form of dust and spray mist, which cause air pollution. Air pollution affects the health of humans, animals and plants alike and also causes damage to buildings.
  • Water pollution is caused by the discharge of untreated chemical waste like dyes, detergents, acids, heavy metals like lead and mercury, pesticides, fertilisers, and plastics from industries, into freshwater bodies like rivers and lakes. Solid wastes like fly ash, phospo-gypsum, and iron and steel slags also cause water pollution.
  • The industries that cause major amount of water pollution are paper and pulp industries, oil refineries, tanneries and electroplating industries. The discharge of hto water from thermal power plants into rivers before cooling is called thermal pollution of water. Radioactive waste, hazardous chemicals, glass, plastic, industrial effluents and non-biodegradable garbage are the main agents of land pollution. Rainwater falling on polluted land dissolves and carries many of the pollutants further into the ground and pollutes groundwater.
  • Loud noise can lead to irritation, loss of hearing, and an increase in blood pressure and hert rate. Industrial machinery, construciton activities, generators, and equipmetn like saws and pneumatic drills are mainly responsible for noise pollution. One of the most important steps for the control of environmental degradation is treating hot and polluted wastewater from industries before releasing it into our rivers and lakes.
  • Watewater treatment involves:

i) Primary treatment through screening, grinding, flocculation and sedimentation.

ii) Secondary treatment through bacteiral action to digest harmful chemcials.

iii) Tertiary stage of stirring with chemicals to neutralise remaining harmful waste.

  • Treated waste water can be recycled for reuse in industrial processes. Rainwater harvesting can be used to meet the requirements of water for industrial processes.
  • Legal provisions must be made to regulate the use of groundwater for industrial use. Smoke stacks, filters, scrubbers, and electrostatic and intertial separators remove a large amount of  harmful particles from industrial smoke. The emission of smoke itself from industries can be reduced by using more efficient fules like oil and natural gas in place of coal.
  • Industrial and generator silencers, and sound-absorbing material are available to reduce the noise level in industries. Industrial workers can use earphone and earplugs for individual protection of health and hearing.
  • National Thermal Power Corporation or NTPC is a major electricity generation and distribution company in India.
  • NTPC has demonstrated how conservation of environment and natural resoruces can happen simultaneously with industrial growth by:

i) Adopting latest technical know how.

ii) Minimising waste by maximising ash utilisation.

iii) Providing green cover therough afforestation.

iv) Reducing environmental pollution through ash pond management, and liquid waste management.

v) Ecological monitoring for all its power sations.

  •  Air Pollution : It is caused by the presence of high propoertion of undesirable gases, such as sulphur dioxide and carbon monoxide.
  • Water Pollution : It is caused by organic and inorganic industrial wastes and affluents discharged into rivers.
  • Thermal Pollution : This pollution caused by the discharge of hot water from factories and thermal plants into rivers and ponds before cooling.
  • Noise Pollution : It is caused by industrial and construction activities, machinery, generators, electric drills and loud-speakers.