Industries can be classified into many different types. Some of the important criteria for the classification of industries include the following:
1) On the basis of strength and size of labour force employed
a) Large Scale Industries : These industries employ a large number of labour force and have also, huge investment in plant and machinery. Iron and steel, heavy engineering, cotton, jute, textiles can be placed in this category.
(b) Medium Scale : These industries employ neither too large a labour force nor too small. Many electrical, electronics, radio, television, computer hardware and even cloth mills fall in this category
(c) Small Scale Industries : According to registration criteria, small scale industry has a capital investment of less than Rs. 1 crore. In India about 80% of all manufacturing units can be classified as small scale industries.
Small scale industries also include cottage and village industries like handloom sector.
(2) On the Basis of Raw Material used and Finished Goods
(a) Heavy Industries: These industries use raw materials in bulk, examples are iron and steel, heavy engineering, ship building etc.
(b) Light Industries : These industries use light raw materials and also produce light finished good. Light engineering and electronics, watches etc. are included in this category.
(3) On the Basis of Ownership
(a) Private Sector Industries : Industries owned by private individual or groups are private sector industries. These are chiefly of two types — Proprietary and Partnership concern and corporate units registered under the company law. Corporate units are very much like public sector units though owned by individuals under share-holding pattern.
(b) Public Sector Industries: These industries are owned by the state or its agencies. Examples are Bharat Heavy Electricals Limited, Indian Petrochemicals Limited. Now many public sector industries are being privatised under the scheme of Disinvestment in Public Sector Units.
(c) Joint Sector: These industries are jointly owned by the government and private forms. Oil India Limited is an example of joint sector enterprise.
(d) Cooperative Sector: Industries under this category are run by cooperatives like those of farmers, milk producers etc. Many Sugar Mills, Mother Dairy etc. are examples of cooperative sector industries.
(4) On the Basis of Raw Materials
(a) Agro-Based Industries : These industries chiefly use raw materials supplied by agricultural sector. Examples are cotton textiles, sugar, silk, jute, fruit preservation etc.
(b) Mineral Based Industries : Minerals like iron, mica, bauxite, cement form their basic raw material for manufacture of goods. Iron and Steel Industry, Aluminium Industry are examples.
Other categories include forest based industries, pastoral based (hides, skins, animal bones etc.) industries etc. Classification of industries is also done on the basis of size of capital or labour force, for example we say capital intensive or labour-intensive industry.