Industries: Factors influencing regional and economic development

The location of industries is a critical decision, influenced by various factors such as access to raw materials, power, markets, capital, transport, and labour. These factors’ relative significance may vary depending on the time and place, but there’s a strong correlation between the type of industry and its proximity to raw materials. Economically, industries are often situated where production costs and delivery expenses to consumers are minimised, with transportation costs largely determined by the nature of both raw materials and finished products.

A Comprehensive Analysis of Factors Shaping Industrial Location

1. Raw Materials: 

• Industries using weight-losing raw materials are located in the regions where raw materials are located. 
• Copper Smelting Plants: These are strategically situated near their respective raw material sources
• Iron and Steel Industries: optimize their locations near coalfields or iron ore sources, which reduces production costs.
• Perishable Raw Industries: Reliant on perishable raw materials are strategically positioned close to their sources to minimize transportation time and costs.
• Example: sugar mills, pulp industry, copper smelting and pig iron industries

2. Power: 

• Certain industries, like aluminium and synthetic nitrogen manufacturing industries tend to be located near sources of power because they are power intensive and require a huge quantum of electricity.

Enroll now for UPSC Online Course

3. Market: 

• Markets serve as the places where manufactured goods are sold. 
• Market oriented industries: Heavy machine, machine tools; heavy chemicals; Cotton textile (non-weight-losing raw material) 
  • Example: Mumbai, Ahmedabad, Surat, etc.; 
• Petroleum refineries 
  • Example: Koyali, Mathura and Barauni refineries. 
• Ports also play a crucial role in the location of oil refineries.

4. Transport: 

The concentration of industries in Mumbai, Chennai, Delhi, and Kolkata stemmed from their emergence as key transport hubs initially. 

• Industries relocated to inland areas only after the establishment of railway lines. 
• Major industrial plants are situated along the main railway routes.

5. Labour: 

Industries cannot function without workers. Skilled labor is essential for industries to operate smoothly. 

• Example: In India, there’s a plentiful supply of labor because of the country’s large population, and workers are often mobile, moving to where jobs are available.

6. Historical Factors: 

Mumbai, Kolkata, and Chennai became industrial hubs for reasons linked to our colonial history. 

• First Wave Industrial Places: When European traders first arrived, they boosted manufacturing in these areas. 
  • Example: Murshidabad, Dhaka, Bhadohi, Surat, Vadodara, Kozhikode, Coimbatore, Mysuru, etc. became key manufacturing centres during this time. 
• During colonial industrialization, these centers grew rapidly due to competition from British goods and unfair colonial policies.

7. Industrial policies: 

The Indian government offers various incentives to industries located in such areas through its policies. 

• There’s a focus on achieving economic growth while ensuring balanced development across regions. 
• Example: Establishment of iron and steel industries in Bhilai and Rourkela aimed at developing backward tribal areas. 

Enroll now for UPSC Online Classes

Conclusion

• The location of industries reflects a complex interplay of factors, from access to raw materials and power to market demand and historical influences. 
• As governments incentivise industrial development in backward areas, there’s a concerted effort to achieve economic growth while ensuring balanced regional development. 
• Understanding these factors helps in making informed decisions about industrial location and promoting sustainable growth.

DOWNLOAD PDF