Introduction to Industry

What is Industry? Let’s Begin with the Basics

Let’s say you’re in a city—any city. Around you, people are making things in factories, digging minerals from the earth, and running shops and software companies. All of these—factories, mines, services—together form what we call Industry.

Industry does not mean just a factory or a building with smoke chimneys. No.
It refers to all economic activities involved in:

• Production of goods (like steel, textiles, cars),
• Extraction of minerals (like coal, iron ore, crude oil), and
• Provision of services (like IT, banking, healthcare).

So, the term “industry” is broader. It includes not just what is manufactured but how and where the entire system functions to support the economy.

Types of Industrial Sectors

Let us begin with a basic premise.
Every economy—whether it is of a small village or a vast country like India or the USA—depends on economic activities. And these activities can be categorized into different industrial sectors based on their function, nature, and distance from the natural environment.

Imagine a journey—from plucking a fruit from a tree, to processing it into juice, to selling it in a supermarket, to managing the data about its sales, and finally, to deciding national food policies around it.
This entire journey can be divided into five sectors.

1. Primary Sector

Think of this as our first contact with nature.
This sector deals with direct extraction of natural resources from the Earth. Whether it’s:

• Agriculture: growing rice or wheat,
• Mining: extracting coal or iron ore,
• Fishing, Forestry, Hunting, or Gathering herbs from forests—

All these are primary activities.

👉 Analogy: If you bake a cake, the act of plucking eggs from a hen coop or grinding wheat into flour would be like the primary sector—you’re dealing with raw, natural materials.

In developing countries, you’ll often find a large percentage of the population engaged in this sector.
For instance, in India, many still depend on agriculture for their livelihood.
In contrast, in countries like the United States, only about 3% of the population works in the primary sector.

2. Secondary Sector

Once the raw material is collected, the question arises: What do we do with it?
This is where the secondary sector steps in. This sector is about manufacturing and construction—essentially, transforming raw materials into finished goods.

What is manufacturing? See, manufacturing is not just assembling machines in a factory. It is a transformation process—changing natural or semi-processed materials into products that have utility or value.

For example:

• Raw cotton → Yarn → Cloth → Garment
  Each step adds value.

So, Manufacturing = Processing + Assembling + Repairing
And this sector is called the “engine of economic growth” because it generates employment, increases exports, and boosts infrastructure

Examples of secondary sector include:

• Textile factories that turn cotton into clothes,
• Automobile manufacturing,
• Steel production,
• Shipbuilding, and
• Construction of buildings and roads.

👉 Analogy: In our cake example, mixing the ingredients and baking the cake—that’s the secondary sector. You’ve moved away from nature, and now you’re creating something new.

This sector usually flourishes in Newly Industrialized Countries (NICs) like India or China, where industrialization is accelerating.

3. Tertiary Sector

Now the cake is baked. But who will sell it? Who will transport it? Who will serve it at a party?
Welcome to the tertiary sector—the service industry.

This includes:

• Retail and wholesale trade,
• Transportation, banking, insurance,
• Healthcare, education, law,
• Entertainment, tourism, and even restaurants.

👉 These are services—not goods. You can’t touch them, but they are essential to the economy.

Developed countries like the UK or the US have more than 70–80% of their workforce engaged in the tertiary sector.
This sector reflects a mature economy.

4. Quaternary Sector

Let’s go a step further.
Who creates the knowledge that improves services? Who’s doing research, building software, generating data, and conducting academic studies?

This is the quaternary sector, which is about:

• Intellectual activities,
• Information technology,
• Scientific research,
• Education,
• Library systems, and
• Government data analysis.

👉 Analogy: If the tertiary sector is serving cake at a party, the quaternary sector is studying the recipe to improve it, or tracking health effects of eating it.

This sector requires a highly educated and skilled workforce and is seen in economies that invest in innovation.

5. Quinary Sector

Finally, let’s look at the highest level of decision-making.

This includes:

• Top executives in multinational corporations,
• Senior government officials,
• University presidents,
• Heads of NGOs, and
• Policy makers in healthcare, science, and media.

The quinary sector involves people who influence national and global agendas.
👉 They don’t just work in the system; they help design the system.

While some scholars merge it with the quaternary sector, others separate it to highlight the strategic decision-making level.

Why Does This Classification Matter?

These five sectors are not just academic labels. They tell us about the stage of development a country is in:

Country Type	Dominant Sector	Example
LEDC (Less Economically Developed)	Primary Sector	Mali
NIC (Newly Industrialized Country)	Secondary Sector	India
MEDC (More Economically Developed)	Tertiary & Quaternary	UK, USA

This also reflects a society’s journey from agriculture to industry, and then to services and intellect.

Conclusion

So, in a nutshell:

• The primary sector connects us to nature.
• The secondary sector helps us build.
• The tertiary sector lets us serve.
• The quaternary sector empowers us to think.
• The quinary sector enables us to decide.

Evolution of Industries in India

– From Artisans to Assembly Lines

India has had a long and proud industrial history. Let’s look at them briefly:

A. Traditional Indian Industries (Pre-colonial Era)

• India was world-famous for its handicrafts and cottage industries.
• Products like:
  • Muslin of Dhaka
  • Chintz of Masulipatnam
  • Calico of Kochi
  • Silks, artistic pottery, and even architectural marvels (e.g., Mehrauli Iron Pillar)

These industries were mostly household-based, skilled, and localized.

B. Decline under British Rule – The Turning Point

With the coming of the British, especially after the Industrial Revolution in England, India became:

• A supplier of raw materials, and
• A consumer of finished British goods.

This crippled Indian artisans:

• Machines in England replaced handmade Indian goods.
• Indian markets were flooded with cheap British imports.
• Cottage industries collapsed, leading to widespread unemployment.

British economic policy = “Drain of Wealth” and Deindustrialization of India.

C. Beginning of Modern Industries (Mid-19th Century Onwards)

But slowly, modern industries began to emerge. Let’s note key milestones:

• 1854: Cotton textile mill in Bombay (Indian capital)
• 1855: Jute mill in Rishra near Kolkata (foreign capital)
• 1870: First paper mill at Ballygunj, near Kolkata
• 1874: Modern steel making at Kulti
• 1907: Tata Iron and Steel Company at Jamshedpur

Even railways—Bombay to Thane in 1854—played a role in industrial growth by improving connectivity.

This period marks the true beginning of India’s modern industrial sector, though growth remained slow due to colonial restrictions.

D. Boost During the World Wars

• Both World War I and II created opportunities.
• Imports from Europe stopped.
• So, India had to develop its own industries—like chemicals, cement, sugar, iron & steel, and glass.

War forced self-reliance. This became a turning point.

E. Post-Independence Industrial Development

After 1947, industrialization became a national priority.

Key objectives included:

• Employment generation
• Regional development (reduce imbalances)
• Support to agriculture
• Consumer protection
• Promotion of exports

With this foundational understanding in mind, let us delve deeper into the evolution of Indian industries by categorizing it into distinct phases for a more comprehensive analysis.

Please note that the next section may be a bit overwhelming for you, if you haven’t completed economics GS section yet. So, please be patient and enjoy the interesting story of the evolution of Indian industry.