Classify industries on the basis of the capital investment. How are they different from one another? Explain with examples.

1. On the basis of the capital investment, industries can be classified into two categories i.e. small-scale industry and large-scale industry.

2. A small-scale industry is different from a large-scale industry in terms of the amount of investment involved in both these categories.

3. For example – a small scale industry like toy manufacturing has a maximum limit of investment of rupees one crore. Any investment beyond the number of rupees one crore say, for example, iron and steel industry is considered to be a large scale industry.

NOTE – In order to better understand the role and manufacturing levels of various industries, they are classified according to certain criteria’s. For example – industries are classified on the basis of raw material – agro-based or mineral based industries, on the basis of ownership – public sector, private sector or joint sector etc.