FACTORS INFLUENCING THE LOCATION OF INDUSTRIES

A.     GEOGRAPHICAL FACTORS

1.      Raw Material

Those industries which use heavy and bulky raw materials are usually located near the supply of the raw materials. Example: Iron and steel industries are generally located near the sources of coal and iron-ore.

2.      Power

Regular supply of power is a pre-requisite for the location of industries. Coal, mineral oil and hydroelectricity are the three important conventional sources of power.

3.      Labour

Labour supply is important in two respects:

                           i.          Workers in large numbers are often required.

                          ii.          People with skill or technical expertise are required.

4.      Transport

Transportation facilities are necessary for the assembly of raw materials and for the marketing of the finished products.

5.      Market

Nearness to the market is essential for quick disposal of manufactured goods. It helps in reducing the transport cost and enables the consumer to get things at cheaper rates.

6.      Cheap Land and Water

Large areas are required to build factories. Many industries are established near rivers, canals and lakes.

7.      Climate

Harsh climate is not much suitable for the establishment of the industries. There will be no industrial development in extremely hot, humid, dry or cold climate.

B.     NON – GEOGRAPHICAL FACTORS

1.      Capital

Modern industries are capital-intensive and require huge investments. Capitalists are available in urban centres.

2.      Government policies

Government activity in planning the distribution of industries for reducing regional disparities, elimination of pollution of air, water and for avoiding their heavy clustering in big cities.

3.      Industrial Inertia

Industries tend to develop at the place of their original establishment, though the original cause has already disappeared.

4.      Banking Facilities

Establishment of industries involves daily exchange of crores of rupees which is possible through banking facilities only.

5.      Insurance

There is a constant fear of damage to machines and man in the industries for which insurance facilities are badly needed.

6.      Political stability

Industries will develop only in those areas where there is political stability.