Page 27 - Understanding Economics for Class 10

2 Sector of the Indian Economy

Goyal Brothers Prakashan

SectorS of economic ActivitieS
There are various economic activities in which people are engaged for producing goods and
services. To understand these activities, we can classify them into groups and these groups are
called sectors.

Primary sector
When we produce a good by exploiting natural resources, it is an activity of the primary sector.
For example,
 Cultivation of cotton- The growth of the cotton plant depend mainly on natural factors
like rainfall, sunshine and climate. The product that comes out of this activity is cotton,
which is a natural product.
 Milk production- It depends on biological process of the animals and availability of
fodder etc. The resulting product is milk, which is a natural product again.
 Minerals and ores are also natural products.
 It is called Primary sector because it forms the base for all other products that we
subsequently make. Since most of the natural products we get are from agriculture, dairy,
fishing, forestry, this sector is also called agriculture and related sector.

Secondary Sector
 The secondary sector is the next step after primary. It processes the raw material supplied
by primary industries and prepared them for consumer products. It covers activities in
which natural products are changed into other forms through ways of manufacturing that
we associate with industrial activity, for example:
 Using cotton fibre from the plant, we spin yarn and weave cloth.
 Using sugarcane as a raw material, we make sugar or gur.
 Converting earth into bricks and use bricks to make houses and buildings.
 Since this sector gradually became associated with the different kinds of industries that came
up, it is also called as industrial sector. The product is not produced by nature but has to be
made and therefore some process of manufacturing is essential, therefore, it is also called
as manufacturing sector. This process could take place in a factory, workshop or at home.

tertiary Sector
 The third category of activities after primary and secondary comes under Tertiary sector.
Activities that help in the development of the primary and secondary sectors falls under
tertiary sector. It supports the production process. These activities, by themselves, do not
produce a good. For example:
 Transport- Goods produced in the primary or secondary sector would need to be
transported by trucks or trains and then sold in wholesale and retail shops.

Economics Class X E-21