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Classification of Industries

Industries may be classified in many ways. Following are some of them:


 On the basis of source of raw materials used:

• Agro based Industries: Industries which get raw material from agriculture sector are termed as Agro Based Industries. Cotton, woollen, jute, silk textile, rubber and sugar, tea, coffee, edible oil are agro based industries.

Mineral based Industries: Industries which draw their raw material from minerals are called Mineral Based Industries.  Iron and steel, cement, aluminium, machine tools, petrochemicals etc. are some examples of Mineral Based Industries.


According to their main role:


• Basic or key industries which supply their products or raw materials to manufacture other goods e.g. iron and steel and copper smelting, aluminium smelting.

• Consumer industries that produce goods for direct use by consumers – sugar, toothpaste, paper, sewing machines, fans etc.


On the basis of capital investment:


A small scale industry is defined with reference to the maximum investment allowed on the assets of a unit. This limit has changed over a period of time. At present the maximum investment allowed is rupees one crore. If investment is more than one crore on any industry then it is known as a large scale industry.


On the basis of ownership:


• Public sector: Public sector is owned and operated by government agencies.  BHEL, SAIL etc. are some examples of Public sector industries.

Private sector: Private sector industries are owned and operated by individuals or a group of individuals –TISCO, Bajaj Auto Ltd., Dabur Industries.

Joint sector: Joint sector industries which are jointly run by the state and individuals or a group of individuals. Oil India Ltd. (OIL) is jointly owned by public and private sector.

Cooperative sector: Cooperative sector industries are owned and operated by the producers or suppliers of raw materials, workers or both. They pool in the resources and share the profits or losses proportionately such as the sugar industry in Maharashtra, the coir industry in Kerala.


 Based on the bulk and weight of raw material and finished goods:


Heavy industries that use heavy raw material to produce goods such as iron and steel

• Light industries that use light raw materials and produce light goods such as electrical industries.


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