STD-X SS -Manufacturing industries

                  Manufacturing industries
Classification of Manufacturing Industry

Manufacturing: Production of goods in large quantities after processing the raw materials into more valuable products is called manufacturing.

Importance of Manufacturing

• Manufacturing industries help in modernizing agriculture; which forms the backbone of our economy. Apart from this, manufacturing industries also reduce the heavy dependence of people on agricultural income. This becomes possible because of creation of new jobs in secondary and tertiary sectors.
• Industrial development helps in eradication of unemployment and poverty.
• Export of manufactured goods expands trade and commerce and brings in much needed foreign exchange.
• A country with high level of manufacturing activities becomes prosperous.

Contribution of Industry to National Economy

The share of manufacturing sector in the GDP (Gross Domestic Product) has been stagnant at 17% over the last two decades. The total contribution of industry to the GDP is 27% out of which 10% comes from mining, quarrying, electricity and gas.

The growth of the manufacturing sector had been 7% in the last decade. Since 2003, the growth rate has been 9 to 10% per annum. The desired growth rate over the next decade is 12%.

The National Manufacturing Competitiveness Council (NMCC) has been set with the objectives of improving productivity through proper policy interventions by the government and renewed efforts by the industry.

ndustrial Location

Some of the factors which affect the industrial location are as follows:

1. Availability of raw materials
2. Availability of labour
3. Availability of capital
4. Availability of power
5. Availability of market
6. Infrastructure

Sometimes, industries are located in or near cities. Cities provide markets and also provide services like banking, insurance, transport, labour, consultants, etc. Many industries tend to come together to make use of the advantages of an urban centre. Such centre is then called as agglomeration economy.

In the pre-independence period, most of the manufacturing units were located in places which were near the ports, e.g. Mumbai, Kolkata, Chennai, etc. As a result, these belts developed as industrial urban centres surrounded by huge agricultural rural hinterland.

Classification Of Industries:

On the basis of raw materials:

1. Agro Based Industries: Cotton, woolen, jute, silk textile, rubber, sugar, tea, coffee, etc.
2. Mineral Based Industries: Iron and steel, cement, aluminium, petrochemicals, etc.

According to their main role:

1. Basic or Key Industries: These industries supply their products or raw materials to manufacture other goods, e.g. iron and steel, copper smelting, aluminium smelting.
2. Consumer Industries: These industries produce goods which are directly used by consumers, e.g. sugar, paper, electronics, soap, etc.

On the basis of capital investment:

1. Small Scale Industry: If the invested capital is upto Rs. one crore, then the industry is called a small scale industry.
2. Large Scale Industry: If the invested capital is more than Rs. one crore, then the industry is called a large scale industry.

On the basis of ownership:

1. Public Sector: These industries are owned and operated by government agencies, e.g. SAIL, BHEL, ONGC, etc.
2. Private Sector: These industries are owned and operated by individuals or a group of individuals, e.g. TISCO, Reliance, Mahindra, etc.
3. Joint Sector: These industries are jointly owned by the government and individuals or a group of individuals, e.g. Oil India Limited.
4. Cooperative Sector: These industries are owned and operated by the producers or suppliers of raw materials, workers or both. The resources are pooled by each stakeholder and profits or losses are shared proportionately. AMUL which is milk cooperative is a good example. The sugar industry in Maharashtra is another example.

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

·  Heavy Industries: Iron and steel.

·  Light Industries: Electronics

Manufacturing Industries

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Textile Industry

The textile industry contributes 14% to industrial production in India. In terms of employment generation, this industry is the second largest after agriculture. 35 million persons are directly employed in the textiles industry in India. The contribution of textiles industry to GDP is 4%. This is the only industry in the country which is self-reliant and complete in the value chain.

Cotton Textiles: Cotton textiles were traditionally produced with hand spinning and handloom weaving techniques. Power-looms came into use after the 18th century. During the colonial period, the competition of mill-made cloth from England destroyed the Indian textiles industry.

At present, there are 1600 cotton and synthetic textile mills in India. Almost 80% of them are in the private sector. The rest are in the public sector and cooperative sector. Additionally, there are several thousand small factories with four to ten looms.

Location of Cotton Textile Industry: This industry was earlier concentrated in the cotton belt of Maharashtra and Gujarat. Availability of raw materials, port facilities, transport, labour, moist climate, etc. were in favour of these locations. The industry provides a source of livelihood to farmers, cotton boll pluckers and workers engaged in ginning, spinning, weaving, dyeing, designing, packaging, tailoring and sewing. This industry supports many other industries; like chemical and dyes, mill stores, packaging materials and engineering works.

Spinning still continues to be centralized in Maharashtra, Gujarat and Tamil Nadu. However, weaving is highly decentralized and there are many weaving centres in the country.

India exports cotton yarn to Japan. Cotton goods are also exported to USA, UK, Russia, France, East European countries, Nepal, Singapore, Sri Lanka and African countries.

At around 34 million, India has the second largest installed capacity of spindles in the world; after China. India accounts for one fourth of the world trade in cotton yarn. However, India’s share in garment trade in the world is only 4%. Our spinning mills are globally competitive and can use all the fibres we produce. But the weaving, knitting and processing units cannot use much of the high quality yarn produced in the country.

Problems in cotton textile industry: Erratic power supply and obsolete machinery are the major problems. Low output of labour and stiff competition; with the synthetic fibre are the other problems.

Jute Textiles

India is the largest producer of raw jute and jute goods in the world. It is the second largest exporter of jute; after Bangladesh. Most of the 70 jute mills in India are located in West Bengal; mainly along the bank of Hooghly. The jute industry is in a narrow belt which is 98 km long and 3 km wide.

Location advantages of Hooghly basin: Proximity of the jute producing areas, inexpensive water transport, good rail and road network, abundant water for processing raw jute and cheap labour from West Bengal, Bihar, Orissa and Uttar Pradesh.

The jute industry directly supports 2.61 lakh workers. It also supports 40 lakh small and marginal farmers who are engaged in cultivation of jute and mesta.

Jute industry is facing challenge from synthetic fibre and also from other competitors like Bangladesh, Brazil, Philippines, Egypt and Thailand. But the internal demand has been rising because of government policy of mandatory use of jute packaging. The National Jute Policy was formulated in 2005 with an objective to increase productivity, improve quality and ensure good prices for the jute farmers. Due to growing global concern for environment friendly and biodegradable material; the future of jute looks bright. USA, Canada, Russia, UAE, UK and Australia are the main markets.

Sugar Industry

India is the second largest producer of sugar in the world. It is the largest producer of gur and khandsari. There are over 460 sugar mills in the country. They are spread over Uttar Pradesh, Bihar, Maharashtra, Karnataka, Tamil Nadu, Andhra Pradesh, Gujarat, Punjab, Haryana and Madhya Pradesh. Sixty percent mills are in UP and Bihar. This industry is seasonal and hence is more suited to the cooperative sector.

In recent years, there has been a growing tendency to shift and concentrate in the southern and western states; especially in Maharashtra. The cane produced in this region has higher sucrose content. The cooler climate of this region ensures a longer crushing season.

Challenges for Sugar industry: Seasonal nature of industry, old and inefficient methods of production, transport delay and the need to maximize the use of baggase are the major challenges for this industry.

Mineral Based Industries

Iron and Steel Industry

Iron is required for making machineries for all other industries hence it is the basic industry. Due to this, production and consumption of steel is often regarded as the index of a country’s development.

India is 9th among the world crude steel producers and produces 32.8 million tons of steel. India is the largest producer of sponge iron. But per capita consumption of steel is only 32 kg per annum.

At present, there are 10 primary integrated steel plants in India. Additionally, there are many mini steel plants in the country. SAIL (Steel Authority of India Limited) is the major public sector company in this sector, while TISCO (Tata Iron and Steel Company) is the major private sector company in this industry.

Most of the iron and steel industries are in the Chhotanagpur plateau region. This region has plenty of low cost iron ore, high grade raw materials, cheap labour and good connectivity through railways and roadways.

Reasons for underperformance of Iron and steel Industry in India:

1. High cost and limited availability of coking coal
2. Low productivity of labour
3. Erratic energy supply
4. Poor infrastructure