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The term 'industry' refers to that part of business activity which concerns itself with the raising. Production, processing or fabrication of products. The products of an industry may be used either by the final consumers or by another industrial undertaking for further production. Accordingly, these will be called consumers goods if used by final consumers, and producers' goods or capital goods if used in the production of other goods. When a concern engages in the production of cloth or toothpaste, or when it processes cheese, it maybe said to be producing consumers' goods. On the other hand, an engineering concern manufacturing machine tools an machinery is said to be producing producers' goods for th simple reason that these products will be used by factories for the production of certain other products.


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In some cases, an industrial concern may produce materials which will be further processed by yet other concerns for conversion into finished consumers; goods. Such materials are generally placed in the category of intermediate goods. An example of this kind is provided by plastics an aluminum which are further used by industry for manufacturing other products.

Types of Industry. The broad sphere of industry may be divided into four distinct types:

(1) Extractive Industries. These industries include activities whereby various forms of wealth
are drawn out, extracted, or raised from th soil air or water or obtained from beneath the surface of the earth. The commodities raised by such industries are produced with comparatively little assistance from man. The products of extractive industries are generally meant to be used by the manufacturing and construction industries for producing finished goods through these may be used directly in some cases. These include hunting, fishing, mining, fruit-gathering, agriculture, afforestation etc.

(2). Genetic Industry. These industries engage in reproducing and multiplying certain species of plants an animals with the object of earning profit from their sale. Examples of this type are nurseries multiplying an selling plants, cattle breeding farms, poultry farms and commercial kennels.

(3) Construction industries. These industries involve construction of buildings, roads, dams, bridges, canals. The distinctive characteristic of these industries is that their products are not marketed in the ordinary sense of being taken to the markets to be sold; they are erected, built, or fabricated at a fixed site. These industries use the products of manufacturing industries, especially cement and iron and steel, as also those of extractive industries like quarries, etc.

(4) Manufacturing industries. Ordinarily, the term industry is used to refer to manufacturing industries. Thought that is not correct, it cannot be denied that the bulk of our requirements is fulfilled by such industries. Manufacturing industries are engaged in the conversion or transformation of raw materials or semi-finished products into finished products. In this process, these industries create 'form utility.' The products of extractive industries generally become the raw materials of manufacturing industries. The cotton textile industry is an example of a manufacturing industry that make use of the cotton produced by farms which are engaged in an extractive industry. Likewise,the iron and steel industry is concerned with the conversion of iron ore produced by mines (extractive industry) into pig iron, steel and various other products. Manufacturing industries maybe divided further into the following categories:

(a) Analytical. In this type of industry, many types of products may be manufactured by analyzing and separating different elements from the same material. For example, in the oil refinery industry, the crude oil is analysed and separated into petrol, diesel, gasoline, kerosene and lubricating oil.

(b) Synthetic. In synthetic industries various ingredients are put together and combined in the manufactured by analyzing and separating different elements from the same material. For instance, cement is produced by combining an mixing concrete, gypsum, coal, etc.

(c) Processing. In this category are included those industries wherein the raw material is processed through different stages of production resulting in the final product. Textiles, paper and sugar are examples of this type.

(d) Assembly line. 'Assembly line' type of industries include the industries where different instruments or component parts already manufactured are assembled to turn out new useful products, e.g,. car, scooter, bicycle, television, etc.
Industries are also classified on the basis of size and investment as follows:

(i) Heavy industries. The term heavy industries is generally used to refer to those industries which call for big capital investment and have a longer production cycle. Such investment goes mostly into machinery and equipment of sophisticated and expensive type Industries like iron and steel, aeronautics, ship-building and aluminum are included in this category.

(ii) Light industries. Light industries are those which involve a comparatively smaller capital investment and have a short duration production cycle. This may be because of the less costly machinery required for the manufacture of certain types of products or because of the us of less sophisticated process of production.

Industries are also classified as large-scale and small-scale according to th capital employed, number of workers employed, materials and tools used and volume or value of output produced over certain periods. For purposes of governmental assistance, a small industry is defined as an industry involving a capital outlay of not more than Rs. 10 lakhs in plant and machinery.

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