Secondary Activities

Manufacturing: how it adds value, what decides where industries locate, footloose and high-tech industries, and how industries are classified.

Key ideas

Secondary activities add value by turning raw materials into more useful products, such as cotton into cloth.
Industries locate by market, raw material, labour, power, transport, government policy and agglomeration economies.
Industries using bulky, weight-losing raw materials (steel, cement) locate near them; aluminium locates near cheap power; perishable raw materials need nearby processing.
Footloose industries are not tied to a raw material and locate by road access.
Modern manufacturing uses mass production, mechanisation and automation; high-tech industries cluster in technopoles such as Silicon Valley.
By size: household (cottage), small-scale and large-scale; by raw material: agro, mineral, chemical, forest and animal based; by product: basic and consumer goods; by ownership: public, private and joint sector.

Metal in ore	ore × per cent metal ÷ 100
Ore needed	metal wanted × 100 ÷ per cent metal
Value after manufacture	raw value × (100 + value added %) ÷ 100
Value added at a step	value after − value before
Saving by mass production	number × (craft price − factory price)
Basic or consumer?	iron and steel, machine tools: basic; bread, soap, TV sets: consumer

Placing a steel plant near the market when its ore is weight-losing (it goes near the ore and coal).
Calling footloose industries heavy polluters tied to one raw material.
Confusing basic industries with cottage industries.

Suppose raw cotton worth ₹4,300 becomes yarn worth ₹4,800, and the yarn becomes cloth worth ₹7,600. How much value is added at each step, and in all?

Working: ₹4,800 − ₹4,300; ₹7,600 − ₹4,800

Answer: ₹500 as yarn, ₹2,800 as cloth; ₹3,300 in all