Classification of Industries
Industries may be classified in more than one ways acording to various dimensions given below.
(i) Ownership basis : On ownership basis the classification is into mixed sector, public sector, private sector and cooperative sector.
(ii) On role or function basis : The industry is divided into basic or key and consumer industry.
(iii) Size of inudustry : The classification is into large scale, small scale, and village and cottage industries.
(iv) Bulk and weight of raw material and finished products : The classification is into heavy industry and light industry.
Heavy industries consume heavy and bulky raw materials and manufacture bulky and heavy goods. They usually consume large quantities of power. Hence heavy industries are located near the source of power and raw materials. Example : Iron and steel, fertiliser, cement.
Light industries consume little raw material, manufacture goods of small bulk, and can possibly employ female labour. A light industry heavily depends on skilled workers and the urban market and is mostly located in a city or town. Examples : radio, television, sewing machines, watches, etc.
(v) Orgin of material used : The industry is divided into agro-based, mineral based etc.
(vi) Labour or Capital Intensive : In labour intensive industries, the cost of labour per unit of production is more than all other costs put together. Obviously, these industries imply a large labour force and require less capital. They make use of relatively less costly machinery which is largely hand operated. Example : glassware manufacture. watch making electronic goods manufacture.
Capital-intensive industries involve huge capital investment for their establishment, mainly for purchasing sophisticated plants and machinery. Such industries usually consume large quantities of raw materials or power. Their production, too, is huge. Example : iron and steel, synthetic fibre, heavy chemicals.
Iron and Steel Industry
Modern steel production in India began in 1907 with the establishment of Tata Iron and Steel Comapny at Jamshedpur (Jharkhand) by Jamshedji Tata. Important raw materials used in this industry are iron ore, limestone, coke and manganese in the form of ferromanganese.
The primary producers of iron and steel are : (i) Tata Iron and Steel Company (TISCO), Jamshed-pur (private sector); capacity 2 million tonnes; (ii) Hindustan Steel Ltd. (HSL), Bhilai ( Russian collaboration, public sector); annual capacity of 2.5 million tonnes of ingot steel; (iii) BSL, Bokaro (Jharkhand, Russian collaboration; public sector), capacity 2.5 million tonnes; (iv) HSL, Rourkela (Orissa, German collaboration), capacity 1.8 million tonnes; (v) HSL, Durgapur (West Bengal, British collaboration, public sector), capacity 1.6 million tonnes; (vi) Indian Iron and Steel Company (IISCO) in West Bengal with workshops at Burnpur, Kutli and Hirapur (public sector) capacity 1 million tonnes; (vii) Visveswarayya Iron and Steel Ltd. (VISL), Bhadravati (Karnataka, private sector), capacity 1 million tonnes; (viii) Visakhapatnam Steel Plant (VSP), (Visakhapatnam, public sector), capacity 3 million tonnes. Two more public sector plants have been constructed at Salem (Tamilnadu) and Vijaynagar (Karnataka).
Location : The location of iron and steel industry which is a heavy industry in India has been primarily governed by transportational costs in relation to iron ore and coal deposits and other raw materials. The industry is highly localised on the Chotanagpur plateau bordering West Bengal, Jharkhand, Orissa and Madhya Pradesh because of the following advantages : (i) proximity to raw materials (iron ore, limestone and coal); (ii) availability of cheap labour; (iii) abundant supply of water, and (iv) modern transport and communication connections with the market centres
There are 7 smelters in the country producing aluminium metal. However, only 6 of these are working viz, Bharat Aluminium Company (BALCO) at Korba (M.P.) and Ratnagiri (Maharashtra), both in public sector and the private sector companies are India Aluminium Comapny (INDAL) at Hirakud (Orissa), Alwaye (Kerala), Belgaum (Karnataka); Hindustan Aluminium Co. (HINDALCO) at Renukoot (U.P.); Madras Aluminium Co. (MALCO) at Mettur (Tamilnadu). Aluminium Corporation of India at Jaykaynager, Asansol (West Bengal) is closed now for several years.
Location : The industry is mostly located in areas producing main raw material, bauxite, and where cheap hydroelectricity is available, as in West Bengal, Uttar Pradesh, Madhya Pradesh and Tamil Nadu.
Traditional handloom and modern cotton textile industry constitutes the largest single industry in India. India is the third largest producer of cotton cloth in the world, next only to USA and China, and ranks second in the world in cotton textile trade. It is the largest industrial employer in the country providing employment to 25 million people. The first cotton mill was set up near Calcutta in 1818. But the real beginning was made with the establishment of cotton mill in Bombay with Indian capital.
Location : Cotton textile industry though widely distributed in the country is generally more localised in the cotton growing areas of drier western parts of peninsula and the great plains. Maharashtra (particularly Bombay) and Gujarat (particularly Ahmedabad) are the leading cotton textile manufacturing states. Tamilnadu and Andhra Pradesh have high spindleage capacity, and Uttar Pradesh, Madhya Pradesh, West Bengal and Karnataka have both high spindleage and loomage capacity.
The main factors which led to the emergence of Bombay and Ahmedabad as the leading centres for cotton textile manufacture in India (in the early days) are : (i) situation in the heart of cotton producing area; (ii) moist climate of the coastal area which permits long yarn to be spun without breaking; (iii) abundant supply of cheap and skilled labour; (iv) port facilities, (v) extensive transporation connection with all parts of the country; (vi) cheap hydroelectric power availability of capital; and (vii) good banking facilities.
With great expansion of home market, the industry has also moved inland in the heart of cotton growing areas in Nagpur and Solapur regions. The growth of hydropower has carried it to far inland tracts in Tamilnadu, Andhra Pradesh, Karnataka, Uttar Pradesh, Madhya Pradesh, West Bengal, Rajasthan and Delhi.
Problems of Industry : Some of the fundamental problems of this industry are : (i) shortage of raw material, particularly long-staple cotton, which is now imported, (ii) low productivity of mills due to scarcity of automatic looms and obsolescence of machinery, (iii) number of mills are sick which require heavy funds for replacement and modernisation purposes; (iv) loss of foreign markets due to increasing cost of production, external factors such as import restrictions and foreign exchange curbs in destination countries etc; (v) inadequate and erratic power supply and competition with decentralised sector; (vi) labour problem; (vii) and above all recession.
Jute textile industry was started in 1859 in Calcutta and the industry has become a big foreign exchange earner in the country. India is the largest producer of raw jute and jute goods contributing 35 per cent of world’s total output. It has the largest number of jute mills, looms and spindles which employs about 2.6 lakh workers and supports 40 lakh jute farmers. The industry besides producing hessians, gunny bags and sacking also produces tarpaulines, ropes, cordages, canvas, water-proof covers, curtains and shoddy blankets.
Location : The factors responsible for unusual concentration of jute mills along the river Hooghly, up and down the port city of Kolkata, are : (i) the soil here is suitable for jute; (ii) early settlement of British merchants in Calcutta; (iii) availability of jute in large quantities, which is grown in the Hooghly basin; (iv) availability of ample water for retting the jute; (v) the area has a humid climate, which is essential for spinning jute fibre; (vi) cheap labour is available from the neighbouring states of Orissa and Bihar; (vii) excellent transport facilities exist for the collection of raw jute and distribution of finished goods; (viii) port advantages at Calcutta hlepful for the export of jute products; and (ix) coal for running jute mills is available from the nearby Raniganj coal mines. Recently there has been a slight dispersal of jute mills due to availability of new jute and increasing demand for jute goods in several other areas of the country. The new areas include Godavari delta of Andhra Pradesh; Kanpur and Shahjanwan near Gorakhpur in Uttar Pradesh, Katihar and Muktapur in Bihar, and Raigarh in Madhya Prdesh.
Problems of Industry : The jute industry suffers from number of problems, viz : (i) non-availability of sufficient quantity of superior quality raw material; to meet this, hectare is being increased and hybrid variety are being grown; (ii) competition from export markets, particularly USA, European countries, Bangladesh, and many other countries which are developing new jute growing areas and have factories equipped with latest machinery, (iii) under-utilisation of capacity as industry is equipped with obsolete machinery which is inadequate for modern requirements and needs modernisation; (iv) high cost of production, low profitability of industry etc.
A series of measures have been taken to improve the situation. They are : (i) Jute Corporation of India set up at Calcutta in 1971 aims at stabilising the prices of raw jute at remunerative levels and promotion of sales of jute goods in foreign markets; (ii) production of jute goods other than hessian and sacking has increased considerably in the recent years and are finding a ready market both within and outside the country; (iii) modern equipments have been added to speed up and diversify the production; (iv) vigorous research programme to find new uses has been undertaken by the industry; (v) Jute Textile Consultative Council has been set up to advise the Government on the industry including its development, production, diversification, moderni-sation and exports.
India is the fourth largest producer of raw silk in the world. It is the only country producing all the 4 commercially known varieties of natural silk — mulberry, tasar, eri and muga. It is the second largest producer of tasar silk, next only to China, and has the world monopoly in muga silk produced only in Assam.
Karnataka is the leading silk producing (almost 70 per cent of country’s output) state followed by West Bengal and Bihar. Karnataka, West Bengal, Jammu and Kashmir and Andhra Pradesh produce almost the entire amount of mulberry silk whereas Bihar, Madhya Pradesh and Assam produce most of the non-mulberry (tasar, muga and eri) silk in the country.
As the raw silk produced in the country is insufficient to meet the demand of silk textile industry, a small quantity is, therefore, imported every year. India exports silk fabrics but it hardly exports raw silk.
Problems of Industry : It suffers from various problems such as (i) competition from artificial silk which is smoother and cheaper than pure silk fibre; (ii) low productivity and inferior quantity of cocoons; (iii) high cost of production; (iv) absence of an orgnised marketing agency; and (v) stagnancy of demand.
The modern woollen textile industry was started in India with the establishment of woollen mill at Kanpur in 1870 and at Dhariwal in 1883. The local demand for woollen goods, the proximity to raw wool producing areas and cheap labour were the deciding factors in the establishment of mills. India has also developed export trade in woollen goods.
Location : Punjab, Maharashtra and Uttar Pradesh are the leading producers of woollen goods, Gujarat, Karnataka, West Bengal and Jammu and Kashmir are the other producing states. Nearly 50 per cent of the mills are in punjab mostly in the Amritsar – Gurdaspur – Ludhiana region, due to the proximity to domestic market in relatively colder weather areas of north-western India and the Himalayan states.
Man-Made Fibres of Synthetic Textiles
India produces and also exports rayon, nylon, terene and decron among the man-made fibres which are produced through chemical processes. These fibres are free from the limitations commonly asociated with the natural fibres. These fibres possess the advantages of man-made fibres along with the natural feel and comfort of natural fibres. They are superior to natural fibres in properties like strength, dyeability, easy washability and resistance to shrinkage. Man-made fibres are mass-produced and their production remains unaffected by the vagaries of nature. Besides conventional uses, man-made fibres find application in innumerable other new ways.
The first rayon plant in the country was set up by the Travancore Rayons Ltd at Rayapuram (Kerala) in 1950. Cellulose pulp from bamboo, eucalyptus and other woods is the basic raw material for producing viscose or acetate rayon.
Man-made fibres industry in India is mostly associated with large textile houses as it is apital intensive and is mostly based on imported raw materials. Almost all the large cotton textile manufacturers produce rayon, nylon and polyester fibres. This textile is highly concentrated in Maharashtra, Gujarat, Uttar Pradesh, West Bengal, Tamilnadu and Delhi.
Problems of Industry : (i) Excessively high prices and import tariffs; (ii) ban on import of polyester filament and metallic yarn; (iii) channellising of import of yarn, machinery spares and chemicals and even export through STC, (iv) high electricity and water rates; (v) rising rents as most of the units are housed in rented premises; (vi) obsolete machinery needs modernisation which involves huge sums of money.
Engineering industry provides an important base for the development of modern industries. Machines which are used by other industries such as the heavy machines required for iron and steel indstry, tools and machines for textile, sugar, cement, tea, paper, chemicals, fertilizers, leather, mining industries, etc. are produced by the engineering industry. Before independence, India was totally dependent on imports for engineering goods. Now it has become almost self-sufficient in this matter.
The major groups of engineering industries are:
Heavy Machinery : Huge machines for use in iron and steel factory are produced in factories located at Ranchi (Heavy Engineering Corporation Ltd.), Naini and Tungabhadra. Coal mining machinery is produced at Durgapur (WB).
Machine Tools : Machines and tools of varying szies and varieties are produced by Hindustan Machine Tools (HMT) located at Bangalore, Pinjore (Haryana), Hyderabad, Srinagar, Pune and Kalamassery (Kerala).
Electrical Equipment : Electrical equipment like turbines, transformers, boilers, etc. are manufactured by Bharat Heavy Electricals Limited (BHEL) located at Hardwar (Uttarakhand), Bhopal (M.P.), Tiruchirapali (Tamilnadu), Ramchandra-puram (AP), Jammu and Bangalore.
Railway : Railway engines or locomotives are Produced at Chittaranjan, Jamshedpur and Varanasi; coaches are produced at Perambur and Bangalore.
Automobile : Automobile and ancillary industry is located particularly at Mumbai, Chennai, Kolkata, New Delhi and Pune.
Shipyard : India’s four shipyards are located at Visakhapatnam, Cochin, Calcutta and Mazagon near Mumbai. The Visakhapatnam shipyard is the biggest, with a manufacturing capacity of three ships a year. Cochin shipyard has been built with Japanese collaboration and has a dock for building the biggest ships of India. Kolkata specialises in manufacturing dredges, coasters, tugs, and barges. Mazagon builds battleships for the Navy.
Aircrafts : The first aircraft factory, Hindustan Aeronauties Limited (HAL) was set up in Bangalore in 1940 because of four major locational advantages. These are : (i) iron and steel is available from the adjoining Bhadravati steel works, (ii) aluminium is available from the not too distant from Kerala, (iii) the climate is equable, and (iv) cheap labour is available in plenty.
The main divisions of HAL, now are : the Nasik division where MIG airframe is manufactured; the Koraput division where MIG aircraft engine is manu-factured; the Hyderabad division where electronic equipment for MIG is manufactured; the Kanpur division where HS-748 aircraft is manufactured, and the Locknow division where aircraft instruments and accessories are manufactured.
Electronics : Bharat Electronics Limited (BEL) at Bangalore produces electronic goods for Defence services, AIR and Meteorological department. Indian Telephone Industries (ITI) at Bangalore produces automatic telephone switching systems, trawger and cross bars, teleprinter exchanges, long-distance transmis-sion systems and electronic test instruments. The Electronics Corporation of India (ECI) Hyderabad manufactures transistorised modular system for nuclear work and for use in medical, agricultural and industrial fields. New ITI at Naini (Allahabad) produces microwave communication equipment.
The raw materials for manufacturing cement are calcareous and argillaceous materials which are found in the form of limestone and clay or shale. In addition, cement manufacturing requires gypsum and coal. Cement indsutries are located near the source of good limestone. In future, in view of the limited supply of cement grade limestone, the slag from steel plants is expected to be used as raw material. The distribution of cement factories in India is highly uneven, involving problem of its transportation. The major cement producing states are Tamilnadu, Madhya Pradesh, Gujarat. Andhra Pradesh, Rajasthan, Karnataka and Bihar.
The main problems of the cement industry are : (i) stockpiling, which results from the location of the industry at limestone centres and the consumption of cement in far away urban centres; (ii) the cost of road transport is very high and facilities for rail transport are inadequate, (iii) shortage of power and fuel at reasonable rates.
The first machine made paper was made in 1870 with the starting of a paper mill in Calcutta. The main raw material for paper and other paper goods are cellulosic pulp, fillers, sizing materials and dyes. Bamboo, conifer wood and grass are ideally used for manufacture of cellulosic pulp. The location of paper mills depends mainly on the pull of market and the sources of raw materials and therefore West Bengal leads the country in installed capacity and production of paper. The factories here obtain bamboos found in Sunderbans, Jharkhand, Assam and Orissa. The other states where factories are widely distributed are Maharashtra, Orissa, Andhra Pradesh, Karnataka and Madhya Padesh. The Nepa Paper Mills in Nepanagar (Madhya Pradesh), Mysore paper Mills and Kerala Newsprint Project produce newsprint.
Problems of Industry : (i) Shortage of raw material; (ii) inadequacy of chemicals used for paper manufacturing; (iii) high cost of production due to labour trouble, use of lower grade of coal, heavy transport cost, etc; (iv) high investment in the mill; (v) sickness in small units; (vi) chronic shortage of newsprint.
India is the world’s largest producer of sugarcane and sugar. India stands first if production of gurkhandsari and crystalline sugar are taken together. It employs nearly 4.25 lakh workers besides sustaining 25 million cultivators of sugarcane.
Location : Sugar industry is a raw material localised industry because : (i) cane is more difficult to transport than sugar; and (ii) sucrose content of cane begins to deteriorate after it has been cut and better recovery is dependent upon its being crushed within 24 hours of its being cut. The sugar industry is predominantly localised in Uttar Pradesh and Bihar besides Maharashtra, Gujarat, Tamilndu, Karnataka and Andhra Pradesh because these regions are exceptionally suited for cane cultivation. This industry does not require supply of fuel from outside since begasse obtained as by product in sugar manufacture is more than enough for raising energy to run the machinery. There is a tendency of migration of this industry towards South where the cane has higher sugar content, the crushing season is longer and a larger number of mills are in the better managed cooperative sector.
Problems of Industry : (i) As the industry is agrobased its output fluctuates with the vagaries of monsoons; (ii) output of sugar depends on output of cane which is influenced to a great extent by the prices of competitive food crops and cane and also the relationship between cane and gur prices, (iii) cane being highly perishable raw material cannot stand slow and long distance transport to the mills, (iv) sugar mills work only during crushing season and remain idle for most part during the off season as it is not possible to bring cane from far off places, (v) inadequate quality and quantity of cane; (vi) high cost of production due to inefficiency and uneconomic nature of sugar producing mills, low yield, short crushing season, high price of sugarcane and heavy excise duties, (vii) old and obsolete machinery.