Industrial Location Factors
For maximum profit making there are two methods
- Least Cost Approach
- Input cost is minimum and low profit margin
- Aims to minimize transportation cost, labour cost and infrastructure cost.
- High Revenue Approach
- High input cost and profit margin is also high
Different Industries
- Agro based industries
- Cotton Industry
- Jute Industry
- Sugar Industry
- Food Processing / Agro based Industry
- Infrastructural Industry
- Iron Steel Industry
- Aluminium Industry
- Automobile Industry
- Cement Industry
- Chemical Industries
- Oil Refineries and based Industry
- Petro-chemical Industry
- Pharma Industry
Cotton Industry
India has a complete cotton textile value chain, from cotton cultivation and ginning to spinning, weaving, processing and garment manufacturing. Cotton is specially important because its supports about 6 million cotton farmers and 40-50 million people in related activities. India has the world's largest area under cotton cultivation, while around 62% of cotton production in rainfed area, making the industry highly dependent on monsoon conditions.
Factors Responsible for the Location of Cotton Textile Industry
- Raw Material
- Proximity to cotton growing regions reduces transportation cost.
- Availability of different varieties- Short, medium and long staple cotton.
- Major cotton belts are Gujrat, Maharashtra, Madhya Pradesh, Telangana, Karnataka.
- Climate
- Humid climate with high temperature with at least 200 days as frost free are essential.
- This reason historically encouraged concentration of cotton industry in Mumbai and Ahmedabad.
- Water Availability
- Large quantities of water are required for bleaching, dyeing, printing and processing.
- Rivers reservoirs and reliable water supply favours textile clusters.
- Labour
- Availability of skilled and semi-skilled workers has encouraged clusters around Mumbai, Ahmedabad, Surat, Tirupur and Coimbatore.
- Power
- Reliable and inexpensive electricity is essential for modern spinning and weaving.
- Cheap hydroelectric power helped the growth of the textile industry in Maharashtra, Karnataka and Tamil Naidu.
- Market
- Huge domestic market especially urban markets such as Mumbai, Delhi, Ahmedabad, Kolkata and Bengaluru encourage downstream industries.
- Transport and Port like Mumbai, Chennai, Vishakhapatnam
- Historical Factors
- Early industrialization, entrepreneurship, capital availability and established markets created a strong path dependency in centres such as Mumbai and Ahmedabad.
Distribution of Cotton Industry
- Western India
- Mumbai, Ahmedabad, Surat, Rajkot
- Southern India
- Coimbatore, Tirupur, Bengaluru, Madhuri, Erode
- Central India
- Nagpur, Indore, Ujjain
- Northern India
- Delhi NCR, Panipat, Hisar, Ludhiana
- Eastern India
- Bhagalpur, Kolkata and nearby regions
- Ahmedabad is called Manchester of India (Manchester is name of city in England which is famous for cotton Industry)
- Mumbai: Tradition Cotton textile known Cottonopolis of India.
- Coimbatore: Manchester of South India.
- Kanpur: Manchester of North
Challenges
- Low productivity of cotton
- India has a very large cotton growing area, but productivity remain a major concern.
- In 2024-25, cotton productivity was around 448 kg/hac.
- Monsoon Dependence
- Lack of Modern Technology
- High Logistic Cost in India
- Environmental Concerns like water pollution
- Cotton is water intensive crop which causes high extraction of ground water.
- Global Competition with China, US, Egypt
Government Initiatives
- PM-MITRA (PM Mega Integrated Textile Regions and Apparel Parks)
- This scheme aims to create large integrated textile parks bringing spinning, weaving, processing, printing, garment manufacturing closer together.
- The Ministry of Textile has allocated ₹ 4,445 crore for the PM-MITRA scheme over 7 years up to 2027-28.
- National Technical Textile Mission
- It promotes high value technical textile used in infrastructure, agriculture, healthcare, automobiles, defence and other specialized applications.
- Integrated Textile Parks
- Skill Development
- Technological Modernization
Jute Industry
Jute is also called golden fibre also. It is important agro-based industry in India along with cotton. India is one of the world's major producer of jute. This industry is mainly concentrated in eastern India where raw jute, water, labour and transport facility are available.
Factors Responsible for Location of Jute Industry
- Raw Material
- Jute is highly water intensive crop. It requires hot and humid climate, abundant availability of surface water is needed.
- Secondly jute as a raw material is gross weight loosing thus jute industry are located in raw material region only. e.g. West Bengal has 70% jute mills of country followed by Bihar and Assam.
- Labour
- It requires bulk of cheap labourers which are easily available in Eastern India.
- Transportation
- Waterways like Hooghly, road transport, rail transport are very important to the market.
- Market
- Jute has strong domestic demand for gunny bags - sacks and packaging material.
- Historical Factors
- For successful jute mills was established and Rishra near Kolkata the then capital of India. Ever since, due to industrial inertia it has been developing along with the banks of Hooghly.
- Secondly, due to partition of India where jute producing areas were in Eastern Pakistan, agricultural land under jute cultivation were increased in India to meet domestic demand and it lead to expansion of jute mills in Assam, Bihar, Uttar Pradesh, Odisha, Andhra Pradesh.
Distribution of Jute Industry
- West Bengal
- It holds 70% of Jute mills of India out of which 90% are concerted along the Hooghly Bank.
- Major centres in West Bengal are Kolkata, Howrah, Rishra, Serampore, Titagarh, Naihati, Shyamnagar and Budge Budge.
- Bihar
- In Bihar major centres are Katihar, Purnea and Samastipur.
- Assam
- Guwahati
- Uttar Pradesh
- Gorakhpur, Sahjanwa
- Odisha
- Bhubaneswar
- Andhra Pradesh
- Visakhapatnam
Challenges of Jute Industry
- Competition from synthetic substitutes like plastic and polypropylene bags.
- Low Productivity
- Because small and fragmented lands.
- Besides this jute cultivation area is also decreasing due to expansion of rice and other crops which are more profitable to farmers.
- Outdated Machinery
- It causes low industrial output thus reduce profitability as well as high maintenance cost.
- Jute Quality of Bangladesh is better than India.
- Labour problems like labour strikes, sick mills.
- International competition with Bangladesh and Ghana.
- Environmental Paradox
- Jute itself is biodegradable but it is highly water intensive and biological oxygen demand and chemical oxygen demand are recorded very high in the Hooghly River due to high organic presence.
Government Initiatives
- Jute Packaging Material Act, 1987
- It creates a guaranteed domestic market for jute products and protects farmers and jute mills from excessive competition from synthetic packaging materials by making mandatory use of jute bags in procurement of food grains and sugar.
- National Jute Board
- It works under Ministry of Textile and promotes jute sector through technology development, market development, skill development and product diversification.
- Jute-ICARE
- It is Improved Cultivation and Advanced Retting Exercise for Jute.
- It aims to improve jute productivity, fibre quality, retting techniques, farmers income, etc.
- Jute Diversification
- From traditional ginny bags now jute is being used in making shopping bags, handicrafts, home décor, carpets, geotextile technical textile, etc.
- Geotextile helps in soil erosion control, soil stabilization, drainage and river bank protection.
Sugar Industry
India is one of world's major sugar producer and has a large, geographically dispersed sugar industry.
Factors Responsible for Location of Sugar Industry
- Raw Material
- Sugarcane is a bulky and priceable and gross raw material. Its sucrose content starts declining after harvesting, making proximity to sugarcane fields highly important. Therefore sugar mills are generally located near the sugarcane fields.
- Favourable Climate
- High temperature, adequate rainfall / irrigation, long frost free growing season and good humidity in the air creates favourable conditions.
- Labour
- Huge amount of cheap workforce is needed for sugarcane cultivation, harvesting, transportation.
- Transport
- Roadways, railways, and waterways.
- Market
- Cooperative Movement
- In this farmers become shareholder and participate in farming, processing and marketing.
- Use of Biproducts
- Sugarcane doesn't provide sugar only. It give
- bagasse which is used to make electricity and paper.
- molasses which is used to produce alcohol and ethanol.
- press mud which is used to produce manure.
- Sugarcane doesn't provide sugar only. It give
Distribution of Sugar Industry
- Northern Belt
- Uttar Pradesh, Haryana, Punjab, Uttarakhand.
- In this UP is largest producer.
- Important areas are Meerut, Muzaffarnagar, Saharanpur, Baghpat, Bijnor, Lakhimpur Kheri, Sitapur, Moradabad.
- Peninsular India
- Maharashtra: Kolhapur, Pune, Sangli, Satara, Ahmednagar.
- Karnataka: Belagavi, Mandya, Bagalkot, Vijayapura.
- Tamil Naidu: Coimbatore, Erode, Tiruchirappalli.