Secondary Activities and Classification of Industries
Geography › Economic Activities and Industrial Location · Topic 20.4
Secondary activities change raw materials into finished goods of higher value through manufacturing, processing and construction. Industries are classified by size into cottage, small-scale and large-scale, by raw material into agro-based, mineral-based, forest-based and animal-based, by ownership into public, private, joint and cooperative, by output into basic and consumer industries, and by weight into heavy and light. India has used industrial policy to raise the share of manufacturing.
5 min read · UPSC Prelims · Geography · Economic Activities and Industrial Location
At a Glance
- Secondary activity Processing and manufacturing
- By size Cottage, small, large
- By raw material Agro, mineral, forest, animal
- By ownership Public, private, joint, cooperative
- Policy Make in India, PLI
- Exam link UPSC Prelims, Geography: Economic Activities and Industrial Location
Where Does It Fit?
This is the fourth topic of the macro on economic activities and industrial location. The previous topics covered the activities that supply raw materials, and this one covers the industries that transform them. The next topic covers the tertiary, quaternary and quinary activities. Previous topic: Mining and Quarrying. Next topic: Tertiary, Quaternary and Quinary Activities.
What Are Secondary Activities?
In short: secondary activities add value by turning raw materials into goods people use.
Secondary activities include manufacturing, processing, construction and energy production. They change the form of materials: iron ore becomes steel, cotton becomes cloth, and milk becomes cheese. The value added by manufacturing is the main source of growth in the early stages of development, and industrial regions have grown at coalfields, ports and big cities. The sector gives jobs, supplies the machines for farming and services, and earns export income. Manufacturing in India produces around 17 per cent of the gross value added, below the aim of 25 per cent set in the National Manufacturing Policy, and employs a smaller share of the workforce than agriculture, as in Population Composition – Sex, Age and Occupation.
How Are Industries Classified?
| Basis | Classes | Examples and notes |
|---|---|---|
| Size (capital, labour, output) | Cottage or household; small-scale; large-scale | Cottage: handloom and pottery, family labour, simple tools, local market. Small-scale: made with machines, hired labour, e.g. toys, small engineering. Large-scale: large capital, many workers, advanced technology, e.g. steel, cars. In India, micro, small and medium enterprises are defined by investment and turnover limits, revised in 2020 and again in 2025 |
| Raw material | Agro-based; mineral-based; forest-based; animal-based | Agro: cotton, jute, sugar, tea, edible oil. Mineral: iron and steel, cement, aluminium, as in Iron and Steel Industry – Process and Location Factors. Forest: paper, furniture. Animal: leather, wool, dairy |
| Ownership | Public; private; joint; cooperative | Public: BHEL, SAIL, ONGC. Private: Tata and Reliance enterprises. Joint: state and private together. Cooperative: Amul and sugar mills of Maharashtra |
| Output and use | Basic or key; consumer | Basic industries supply raw materials to others, e.g. iron and steel, cement, fertiliser. Consumer industries produce goods for final use, e.g. textiles, sugar, electronics |
| Bulk and weight | Heavy; light | Heavy: steel, shipbuilding, with bulky raw materials. Light: electronics, clothing, which use light inputs and produce light goods |
| Location behaviour | Footloose industries | Industries not tied to a particular raw material or place, such as software, electronics assembly and many service-linked industries, which can locate wherever skilled labour and connectivity exist, as in Factors Influencing Industrial Location |
What Is the Industrial Scene in India?
- Regions: the main industrial regions are the Hooghly belt around Kolkata, Mumbai–Pune, Ahmedabad–Vadodara, the Chotanagpur plateau, the Bengaluru–Chennai–Coimbatore–Madurai belt, the Gurugram–Delhi–Meerut region, and the Kollam–Thiruvananthapuram region in Keralam (Kerala).
- Small units: micro, small and medium enterprises produce about a third of the country’s manufacturing output and employ a large number of workers; the sector faces problems of credit, technology and compliance.
- Policy: Make in India (2014), the Production Linked Incentive schemes (from 2020) for sectors such as electronics, pharmaceuticals and automobiles, the India Semiconductor Mission, industrial corridors such as the Delhi–Mumbai Industrial Corridor, PM Gati Shakti for logistics, and the National Logistics Policy, as in Road Transport in India.
- Challenges: high logistics and capital costs, informality, a skills gap and the dependence on imported inputs, in particular electronic components from China, as in India International Trade.
As an analytical point, many countries of East Asia moved from agriculture to manufacturing and then to services, which gave them jobs for large numbers of workers. India has moved more quickly to services, and so the quality of manufacturing jobs, the scale of small firms and the integration of Indian firms into global value chains will decide whether the industrial sector can absorb the large young workforce, as in Basis and Aspects of International Trade.
Why Is This Topic Important?
- Concepts Classification asked
- Policy PLI, Make in India
- Link Jobs and exports
What Came Next?
The next topic describes the tertiary, quaternary and quinary activities. Next topic: Tertiary, Quaternary and Quinary Activities.
Key People and Terms
- Manufacturing Making goods from raw materials
- Cottage industry Household craft production
- Basic industry Supplier of inputs to other industries
- Footloose industry Industry free of raw material location
- MSME Micro, small and medium enterprise
- PLI Production Linked Incentive
Exam Corner
Points to Remember
- Size: cottage, small, large.
- Raw material: agro, mineral, forest, animal.
- Ownership: public, private, joint, cooperative.
- Basic industries supply other industries.
- Footloose industries are not tied to raw materials.
Do Not Confuse With
- Basic and consumer industries Inputs for industry versus goods for final use
- Joint and cooperative sector State plus private versus member-owned
- Heavy and large-scale industry Weight of goods versus size of the unit
Memory Hook
Size, source, owner, output, weight: five lenses on every factory.
Mains Angle
Questions ask for classification with examples and policy. These points add depth.
- Classes Five bases
- India MSMEs and regions
- Policy PLI and logistics
A Question You May Face
An original practice question, not a past paper question.
“Classify industries on different bases with examples and discuss the role of micro, small and medium enterprises in India’s industrial development.”
How to Answer
- Meaning Secondary activities.
- Classes Size to location behaviour.
- MSME Jobs and credit gap.
- Policy Make in India, PLI.
GS Relevance
Frequently Asked Questions
What are secondary activities?
Secondary activities are economic activities that process raw materials into finished goods of higher value, such as manufacturing, processing and construction. They convert, for example, iron ore into steel, cotton into cloth and sugarcane into sugar, and are the core of industrial development.
How are industries classified on the basis of raw materials?
On the basis of raw materials, industries are agro-based, such as cotton textiles, sugar and jute; mineral-based, such as iron and steel, cement and aluminium; forest-based, such as paper and furniture; and animal-based, such as leather, woollen and dairy industries.
What is the difference between public and private sector industries?
A public sector industry is owned and run by the government, such as SAIL, BHEL and ONGC. A private sector industry is owned by individuals or companies for profit. In a joint sector industry the state and private firms share ownership, and a cooperative industry is owned by its producers, such as Amul.
What are basic and consumer industries?
Basic or key industries produce goods that are the raw materials or inputs of other industries, such as iron and steel, cement, fertilisers and heavy machinery. Consumer industries produce goods for the final use of consumers, such as textiles, sugar, electronics and processed food.
What are footloose industries?
Footloose industries are industries whose location is not strongly tied to the sources of raw materials or any particular place, because they use light, valuable or easily transported inputs. They can locate wherever skilled labour, power and connectivity are available, as in software, electronics assembly and some light engineering.
PYQ Practice — Statement Analysis
1 Iron and steel is a mineral-based, basic industry.
It supplies other industries.
2 Cottage industries use large capital and many hired workers.
They use family labour and simple tools.
3 Amul is an example of a cooperative sector enterprise.
It is owned by milk producers.
4 Footloose industries are tied to coal fields.
They are not tied to raw materials.
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