Gujarat BoardEnglish MediumSTD 12 CommerceEconomicsINDUSTRIAL SECTOR5 Marks
Question
Explain Structure of Industry.
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Answer
$1.$ Introduction:
India has become more progressive in industrial sector because industrialization was emphasized in the five years plan for economic development to understand industrial sector.
It is necessary to know the structure of industry.
Industrial structure of India is classified according to the size of capital investment, ownership, the utility of products, method of production etc.
$2.$ Industrial Structure $($Classification of Industry$):$ Industries are classified as below according to the labourers engaged in an industrial unit or capital invested in it.
$[A]$ Classification of Industries based on Investment size:
$(1)$ Cottage Industries:
Industries which are run mainly through the members of the family without using electrical machines only with simple instruments with negligible capital investment is known as cottage industry E.g., Khadi, Papad, Embroidery, Incense stick, carpentry, black-smith's work, etc.
These industries employee more people prior to the Britishers arrival in India.
Cottage industries has unique place in India.
$(2)$ Tiny Industries:
The industries in which less than $Rs.25$ lacs is invested and run by complete labour based production technique are called tiny industries or very small industries.
E.g. Making artistic things from leather, metal, clay, etc.
$(3)$ Small Scale Industries:
The industries in which from $Rs.25$ to $Rs.5$ Crore is invested and it is run by only labour based production technique and it is supporting to large industries are called Small Scale Industries.
E.g., Industries manufacturing consumer goods, automation goods, manufacturing of specific parts of items produced by big industrial units
Generally, compare to medium and large industries, started with comparatively less capital and to more labour based with local factors are of less importance are known as small industries.
$(4)$ Medium Scale Industries:
The industries in which the amount invested in more than $Rs.5$ crore and less than $Rs.10$ crore and with labour intensive and capital based technique are called medium scale industries.
E.g. Machinery, chemicals, electronic instruments etc. making industries.
$(5)$ Large Scale Industries:
The industries which adopts only capital based production technique and more than $Rs.10$ crore is invested is called large scale industries.
E.g. Equipment related to Steel Plants, Big vehicles, Cement, Tools of railway, etc. are made by large scale industries.
The following characteristics are observed in such industries:
$(1)$ Large Scale Investment
$(2)$ Large Scale Production
$(3)$ Capital based and modern production technique
$(4)$ They are found mainly in urban areas
$[B]$ Classification of Industries based on Ownership:
Industrial units can be divided as under on the basis of its ownership$: (1)$ Public Sector $(2)$ Private Sector $(3)$ Joint Sector $(4)$ Co-operative Sector
$(1)$ Public Sector $($Units$):$
The industries controlled and owned by government is a public sector unit.
The ownership of public sector unit is of local government, state government or central government.
E.g., Railway, telephone, post, atomic energy etc. are the industries owned by government.
They are public sector units. Public sector units are classified in three categories according to their variety:
$(A)$ Departmental Industries:
When government runs industrial units under its direct observation as its department and includes its income and expenditure provision in budget is known as departmental industries.
$(B)$ Public Corporations:
Units owned by state or central government but administered independently by corporation are called public corporations.
E.g. Life Insurance Corporation, State Transport Corporation, Air India, $IFFCO,$ Producing and selling fertilizers, $GNFC$ etc. units.
Public corporations are managed independently yet governments influence is observed in its policy decisions.
$(C)$ Joint Stock Companies:
The units managed by government like private companies under frame work of company laws.
Government issues shares and collects capital from public or institutions.
Such companies are joint stock companies.
They are free from direct government control.
Administrators have more powers to take policy decisions than public corporations and departmental units.
The units which are owned and managed completely by private sectors are known as the units of private sectors.
The management of such units is personal or in partnership.
E.g., $TISCO$ Company, Reliance Industries Ltd, Hero Honda Moto Corp Ltd., Bata Shoes Company and $TV.$ and mobile manufacturing companies.
$(3)$ Joint Sector Industries:
Units in which the ownership is private as well as of government is known as Joint Sector Industries.
In this type of industries government issues share capital and sells its ownership rights to people and firms.
Government issues $51\%$ or more shares.
Such units are under the control of government but still take the advantage of efficient management from the economic reforms in India the development of the industries of Joint sector are emphasized.
$(4)$ Co-operative Sector Industries:
The ownership of the unit is not private or individual but on co-operative basis is called co-operative sector.
E.g., Sugar industry in Gujarat and Maharashtra, Dairy industry is developed on co-operative basis.
Co-operative sector has entered in banking services also.
The aim of co-operative sector is to stop exploitation of marginal owners, to stop exploitation of labourers.
Consumers and to distribute the benefit of the unit among the members.
$[C]$ Types of Industries on the basis of Products $($Classification$):$
Industries on the bases of products can be classified as under:
Units which produce semi-finished goods means the goods which are semi processed and one stage of production is remaining is known as semi-finished goods industries.
E.g., The industry of Yarn, Steel Sheets, machines etc.
Normally these industries produce man made physical instruments for production.
In India people with higher education are not interested in going to rural areas, and stay in backward areas even if they get unemployment.
Attraction towards modern life style, modern facilities of cities and rural sectors are backward that why unemployment occurs.
$[D]$ Types of Industry on the bases of Production Technique:
Industries can be divided into two types on the basis of production technique:
$(i)$ Labour based industry in which labour is used.
$(ii)$ Machinery based industry in which machines are used for production.
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