By Harshvardhan, the Subject Matter Expert at Edumarz
Solution: Industry refers to all those economic activities which are connected with the conversion of resources into useful goods. Commonly, the term industry is used for activities in which mechanical appliances and technical skills are involved. These include activities relating to producing or processing goods, breeding, and raising animals. The term industry is also used to mean groups of firms producing similar or related goods. For example, the cotton textile industry refers to all manufacturing units producing textile goods from cotton. Similarly, the electronic industry would include all firms producing electronic goods, and so on. Further, in common parlance, certain services, like banking and insurance, are also referred to as an industry, say banking industry, the insurance industry, etc.
Industries may be divided into three broad categories given below:
- Primary industries: These include all those activities which are concerned with the extraction and production of natural resources and reproduction and development of living organisms, plants, etc. The common most example of a Primary Industry is Crude Oil Extraction Industry which extracts crude oil from seabeds.
- Secondary industries: These are concerned with using materials, which have already been extracted from the primary sector. These industries process such materials to produce goods for final consumption or for further processing by other industrial units. For example, the mining of iron ore is a primary industry, but manufacturing steel by way of further processing of raw irons is a secondary industry. Also, The Conversion of Crude oil into Petroleum and Diesel is the Work of a Secondary Industry.
- Tertiary industries: These are concerned with providing support services to primary and secondary industries as well as activities relating to trade. These industries provide service facilities. As business activities, these may be considered part of commerce because as auxiliaries to trade these activities assist trade. Included in this category are transport, banking, insurance, warehousing, communication, packaging, and advertising. A common example of Tertiary Industry is Reliance Jio which offers Communication Facilities.