Factors Shaping Industrial Location

The factors affecting the industrial location are the availability of raw material, land, water, labor, power, capital, transport and market. Industries should be located at points where the production costs are minimum. Hence, Industries are situated where some or all of these factors are easily available. 

Industrial location, a key aspect in this decision-making process, plays a pivotal role in determining the success and efficiency of an industry. Sometimes, the government provides incentives like subsidized power, lower transport cost and other infrastructure so that industries may be located in backward areas. Industrialisation often leads to development and growth of towns and cities.

Some of the factors that influence the industrial location are as follows:

Table: Factors influencing industrial location

A Comprehensive Look at the Classification of Manufacturing Industries

Manufacturing industries are classified on the basis of their size, inputs/raw materials, output/products and ownership. This classification plays a crucial role in the broader context of industrial location, shaping the economic landscape. Let’s delve into the details of this classification.

Enroll now for UPSC Online Course

Let’s analyse this classification of industries  in detail. 

Exploring the Spectrum of Household, Small-Scale, and Large-Scale Manufacturing

• Metrics of Magnitude: The amount of capital invested, number of workers employed and volume of production determine the size of industry. 
• Accordingly, industries are classified into household or cottage, small-scale and large-scale industries.

Cottage Manufacturing: Crafting Local Livelihoods through Artisanal Ingenuity

• Artisanal Manufacturing: This type of manufacturing represents the smallest-scale production unit.
  • Artisans utilise local raw materials and basic tools to create everyday items within their homes
  • It  often involves the assistance of family members or occasional part-time labour. 
• Local Economies: Finished products may be for consumption in the same household or, for sale in local (village) markets, or, for barter.
  • In this form of Production, factors like capital and transportation have limited influence because it holds low commercial significance, and most tools are crafted locally.
• Diverse Range of Products: Typical products produced within this sector encompass a range of everyday goods,
  • Example: Food items, fabrics, mats, containers, tools, furniture, wooden figurines sourced from local woodlots and forests, leather goods such as shoes and thongs, pottery, bricks from locally available clays and stones, and jewellery made from gold, silver, and bronze by skilled goldsmiths. 

Empowering Communities: The Impact of Small-Scale Manufacturing on Local Economies

• Beyond the Household: Small-scale manufacturing is distinguished from household industries by its distinct production methods and the location of manufacture
  • It typically takes place in workshops situated outside the home or cottage of the producer.

• Characteristics of Small-Scale Manufacturing:

• • This form of Production relies on local raw materials.
  • It  incorporates basic power-driven machinery, and employs semi-skilled labour.
• Employment Generation and Economic Growth: It plays a crucial role in generating employment opportunities and boosting the local purchasing power within communities.
  • As a result, countries like India, China, Indonesia, Brazil, and others have developed labour-intensive small-scale manufacturing as a means to provide jobs for their populations.

Transforming Industries: Exploring the Dynamics of Large-Scale Production

• Characteristics Large-scale Manufacturing: It is characterised by several key features, such as
  • Access to various raw materials, enormous energy, specialised workers, advanced technology, assembly-line mass production and large capital.
•  Two Broad Types: On the basis of the system of large scale manufacturing, the world’s major industrial regions may be grouped under two broad types:
  • Traditional large-scale industrial regions which are thickly clustered in a few more developed countries.
  • High-technology large scale industrial regions which have diffused to less developed countries.

Enroll now for UPSC Online Classes

Read Also: Cultivating Prosperity: The Dynamics of Agro-Based Industries and Their Impact on Economy

DOWNLOAD PDF