Business Studies Class 11 What is Industries and Its Types?
You all have been familiar with the word “Industry“. There are so many definitions of the industry but what does industry mean? You have been using smartphones, televisions, video games, etc, where does all of this come from? Obviously, you have purchased it from distributors but these goods are manufactured by different Industries. So basically, Industry is the group of manufacturers who convert the raw materials into finished goods with the help of labors and machinery.
Industry comes from the Latin word Industria which means “hard work” and the word is still used with that meaning. Industries play an important role in our day to day life as most of the goods whether electronic devices, automobiles, and even food products are manufactured or produced by various industries. There is a famous quote on the industry by Benjamin Franklin
“Sloth makes all thing difficult, but industry all things easy“
Industries made our life so easy and uncomplicated by producing the goods which are used in our daily life. The industry involves collecting raw materials, making them into finished products like converting grains into flours. Running an industry requires great skills of management as we have to manage everything wisely to get the best results.
There are so many types of industries like the automobile industry, agriculture industry, pharmaceutical industry, transportation industry, telecommunication industry, etc., but all of these industries fall into three main categories and they are as follows:-
- Primary Sector
- Secondary Sector
- Tertiary Sector
Let us discuss each type of industry one by one.
Primary Sector of the economy involves those industries which work on the extraction of natural resources like farming, mining, fishing, etc. Basically, it collects the raw material from natural resources. In traditional economies, the primary sector usually represents the largest sector of employment. The primary sector provides raw material to the secondary sector, so for the great working of both secondary and tertiary sector, the primary sector is important.
Role of Primary sector in our day to day life
The primary sector is playing an important role in the area of employment as tertiary and secondary sectors have failed to create enough jobs. The primary sector provides basic necessities of life. This sector is more important in developing countries like India, Bangladesh, etc. as compared to developed countries like US, UK, and Canada. It provides raw material to the secondary sector, the well being of the Secondary and Tertiary sector is strongly dependent on the Primary Sector. The primary sector can be improved my modernization of the machinery to reduce labor work. Today most of the people in India are engaged in the primary occupation because India produced many types of primary products to other countries. The primary sector is the largest economic sector and plays an important role in the overall development of the country.
Examples of the primary sector-
Farming, animal husbandry, forestry, mining, etc are the most common examples of primary industries and all the industries which can produce raw material are fall under this sector.
Secondary sector of the economy involves those industries which produced finished usable goods with the help of raw materials, machinery, labor, etc. The secondary sector is sometimes also called as production sector. Electrical industry, Chemical industry, food industry, etc are the types of secondary sector industries. It includes the processing of raw materials, textile manufacturing, food manufacturing and many more. The secondary sector supports both the primary sector and the tertiary sector.
Role of the Secondary sector in our day to day life
Though the secondary sector depends on the primary sector but after the processing of raw materials in industries the value of the goods increases which leads to more profit and help in the increment country’s economy. The development of this sector demands more goods which lead to industrialization. This sector is an important source for engineering job opportunities. Secondary sector becomes the large sector for developed countries but in developing countries like India, we have directly moved to service or tertiary sector without improving our command on this sector. However, the Secondary sector produces more waste materials than any of the sectors which causes pollution, but many new techniques and methods have been adopted to decrease pollution.
Examples of the secondary sector-
Converting of woods into furniture’s, textiles into clothes, grains into food products are all examples of secondary industries and all the industries. which can manufacture, process and constructed finished goods falls under this sector.
The tertiary sector is also known as the service sector. This sector provides service instead of operating goods or products. The tertiary sector is a collection of those industries which provides intangible(no physical form) services like transportation of goods, providing resources such as electricity or water supply, etc. Basically, the tertiary sector includes human activities whose work is to provide services. Tertiary sector includes profitable and non-profitable services. Profitable services include transportation of goods, hotels, and resorts also fall under this category while non-profitable service includes NGO’s and State education, etc. Knowledge oriented economic sectors such as IT sectors, media sectors are now considered as quaternary sector instead of the tertiary sector.
Role of Tertiary sector in our day to day life
The need for the tertiary sector is increasing day by day as there is more need of services like educational institutions, tourism, transportation, financial services, etc. Tertiary sector not only provides employment to educated workers but also the uneducated and unskilled workers. With the growth of the primary and secondary sector, the demands for the service sector also increases. As with the increment in the economic growth, the demand for private schools, hospitals, a financial institution is also increasing which leads to the development of the tertiary sector. Most of the developing countries are working more in the tertiary sector instead of the primary or secondary sector. In India, half of the population is involved in this sector as there is a vast opportunity for employment more than the other two sectors.
Examples of the tertiary sector-
Educational institutions, financial institution, Hotels, Catering, medical services, tourism, etc are the examples of tertiary industries and all the industries which provides services whether profitable or non-profitable falls under this sector.
Importance of industrialization in India
As we all know India is an under-developed country which requires great capital to abolish poverty. Industrialization can play an important role in the development of our country.
- Industrialization helps in the economic growth of the country as it provides ample opportunities of employment as there is a need of laborers and workers in every industry, even there is a need of worker to handle machinery also.
- Industrialization leads to productive use of natural resources and it provides finished goods which make our life easy.
- Industrialization increases per capita income and it helps in the growth of international trade which is beneficial for our country.
- Industrialization is also important for the growth of science and technology.
- The needs of people are fulfilled by the means of industries.
So for the development of India, there is a need for industrialization.
Contribution of Industries to GDP and Economy
The economy of India is a developing economy. India has one of the fastest growing service sectors in the world. Gross Domestic Product simply is known as GDP which is the total value of all goods and services produced in the economy. GDP growth rate is a kind of indicator of the condition or state of the country’s economy. Earlier, the Primary sector in India had the biggest share in the GDP but with the time it’s contribution goes on declining though India ranks second in the agricultural output after China.
The GDP distribution across the sectors in India is given below:
◆ 15.11% in the Primary sector
◆ 31.12% in Secondary sector
◆ 53.77% in the Tertiary sector
The industrial sector is one of the main sectors which contributes to the Indian GDP. However, Industrialization helps a lot in the development of Indian economy, the government of India thus must continue to make efforts in the industrial sector to increases country’s economy which will automatically decrease the rate of poverty and unemployment.
Thus, the industrial sector plays an important role in our life as it leads not only the development of our country but also there is a considerable rise in the standard of the living of the people.
The writer of this article is Zia Khan.
Read another note of Class 11 Business studies on Security and Safety of Business Transaction
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