Secondary and Tertiary Industry

SECONDARY INDUSTRY:
It is the changing of raw materials from primary or secondary sectors into semi-finished or finished products. Through
processing or manufacturing.

Inputs:
Capital- Land- Power- Labour- Enterprise- Raw materials- Transport- Machinery

Processes:
• Smelting: The chemical reduction of a metal from its ore by a process usually involving fusion, so that earthy
and other impurities separate. It is used in Iron and Steel industry.
• Weaving: A method of textile production in which two distinct sets of yarns or threads are interlaced at right
angles to form a fabric or clothing the form of warp and weft. It is used in Cotton Textile industry.
• Spinning: A method of twisting together of drawn-out strands of fibers to form yarn, and is a major part of the
textile industry. The yarn is then used to create textiles. It is used in Cotton Textile industry.
• Dyeing: A process in which color is transferred to a finished textile or textile material (like fibers and yarns) to
add permanent and long-lasting color. It is used in Cotton Textile industry.
• Printing: A process of printing a fabric, these being the block, roller, screen, heat transfer and ink-jet methods.
It is used in Cotton Textile industry.
• Knitting: A process that creates multiple loops of yarn, called stitches, in a line or tube to make fabric in Cotton
Textile industry.
• Stitching: A process by which pieces of fabric are sewn together to make garments in the Cotton Textile
industry.
• Tanning: A process of treating animal skins to produce leather. It is used in leather industry.
• Molding/ Moulding: A process of manufacturing by shaping liquid or pliable raw material using a rigid frame
called a mold or matrix. ... A mold or mould is a hollowed-out block that is filled with a liquid or pliable material
such as plastic, glass, metal, or ceramic raw material.

Output:
Cement- Fertilizers- Cotton yarn- Sugar- Iron (pig)- Coils- Drugs- Fans- Tractors- Galvanized sheets

FACTORS INFLUENCING INDUSTRIAL LOCATION:

Collecting all inputs: On low costs
Processing / manufacturing items: On low costs
Market distribution: For high profit
Physical factors:
Natural route sites requirement (Flat Land, Vast Land, Cheap Land)
Human factors:
Capital, raw materials, skilled labor, transport, government policies, access to market, industrial linkages.
Raw materials:
Basic commodity from which semi or finished products are made
May be of primary sectors (directly from ground / sea)- Like fishing, forestry, farming, mining, etc. For example: wheat,
cotton (raw), limestone, etc.
It may also be of secondary industry (processed / semi-manufactured). For example: cotton yarn, wood pulp, coils, etc.

TYPES OF SECONDARY INDUSTRY:

Cottage:
Home based- Family labour- Inherited knowledge- Traditional tools- Low capital invested- Very small output.
Small scale:
Small amount of land- Small amount of machinery- Small amount of capital (up to 10 million rupees)- Small amount of
labour (10 people)- Small amount of raw material- Small outputs- Small profit.
Large scale:
Large amount of bulky raw materials- Large amount of power- Large amount of machinery- Large amount of labour.
Labour intensive:
This is where skills of labour is more important than machinery) For example: Cottage industry.
Capital intensive:
This is where machinery is more important than labour. For example: large scale industry like steel and ship making.
Heavy industry:
This is where weight of the output is far more than its price.
Light Industry:
This is where weight of the output is far less than its price.
PRINCIPAL INDUSTRIES OF PAKISTAN:
COTTON TEXTILE:
50% of employment to industrial labour- About 60% of exports are connected to Cotton Textile- Foreign exchange
earned- Fulfils local demand so less import needed- Utilizes local raw material.

Main areas are: Karachi, Hyderabad, Multan, Quetta and Faisalabad.

Process for cotton textile mills:

Ginning: Separating Cotton seeds and seed hulls from fiber.
Spinning: Converting fiber into yarn.
Weaving: Forming fabric by interlacing threads.
Polishing and Dying: treating with chemicals and adding colour to the fabric.
Printing: Adding pattern or design on the fabric.
Raking: Drawing together similar implement.
Floating in the market: Sending ready-made fabric to the market.

Problems of Textile Industry:

Leaf Curl Virus which reduces raw materials (Cotton)- Recession in international market so less demand abroad which
reduces exports- Competition from South Korea / Egypt affects exports- Lack of finance- Load shedding of electricity and
natural gas reduces/delays Production-Lack of government attention which effects development.

Importance of Cotton Textile Industry:

It provides employment to the highest number of industrial labour in Pakistan- It facilitates the need of cloth and fabric
to the local market- It earns high value of foreign exchange providing positive balance of trade to economy- It boosts the
local agriculture due to high demand of cloth locally as well as internationally- The by-products provide Cotton seed oil
and fodder for animals.

Q: What are the advantages and disadvantages of developing the cotton manufacturing industry in
Pakistan?

Advantages:
Established industry / good reputation world wide- Creates jobs / employment so develops skills- Traditional skills /
cheap labor available- Value added exports / large scale export / main export- Higher price (because it is processed /
value added)- Farmers can increase income.

Disadvantages:
Lack of money to invest / investors- Lack of modern skills / education- Competition from other countries- Old machinery
so more breakdowns, slow, old products (need to import machinery)- Water shortage for manufacturing / conflict with
other users- Power shortage / power breakdown- Poor roads and railways / transport to ports- Government policy /
changing policies-Less land for growing food and other crops- Problems of pest attack / climate problems/ poor harvest-
Effects of increase in urban population, e.g. Increase in rural-urban migration- Named pollution increases linked to
cotton manufacturing, e.g. Noise pollution as noise of machinery is very loud (may cause deafness)- Machines will
replace manpower so loss of unskilled labor- Lack of investment in other industries / services.

CEMENT INDUSTRY:
Limestone, sulfur, gypsum locally available which are the main raw materials. Coal / natural gas is available as fuel. High
demand in construction industry. For example,
dams, barrages, etc. bridges, underpasses, roads, etc. lining canals, houses / factories / hotel, etc
Pakistan has insufficient timber for construction so use cement in some other parts because steel industry is small. Main
areas are Salt Range, Karachi and Hyderabad.

Q: Explain the importance of concrete (cement) to the development of Karachi.

Developing / increasing population / industrialization of offices, housing, ports, roads, etc. Used to make infrastructure
for e.g. For better roads for transport and better bridges for easy access. Stronger building material which is long-
lasting / more durable and also has a modern appearance. Improving slums / squatters.

FERTILIZER INDUSTRY:
Natural gas as fuel. Sulfur and gypsum are locally available which are the main raw materials. Green revolution in
agriculture so more demand, use of HYV seeds thus more chemical fertilizers. Soil is deficient in nitrogenous matter, so
chemical fertilizers provide organic nutrients to soil. Growing population so more demand of food. Main areas are
Multan, Faisalabad, Mechigot, Haripur

Q: What are the benefits of increasing fertilizer production for the people and economy of Pakistan?
Higher yield. More food production rate. More agricultural exports or improved Balance of Payment. Reduces imports of
fertilizer or improved Balance of Payment. Higher GDP / GNP. Less debt. Higher farm incomes / profit. More jobs.
Cheaper cost of fertilizer. More industrial goods (e.g. cotton).

SUGAR MILLS:
Sugar cane abundantly available in Pakistan which is the main raw material. High demand of sugar in Pakistan due to
high population. Main areas are Peshawar, Faisalabad and Nawabshah. Sugar mills must be close to area of sugar
cultivation because Sugar cane must be crushed quickly after cutting as it loses its weight rapidly
and reduces sugar content rapidly. It keeps down transport cost because sugar cane is bulky therefore expensive and
difficult to transport.
Sugar mills work only 160 days a year. This causes the following problems: Seasonal employment / unemployment for
the rest of the year. Skilled workers may be lost to other industries permanently. Inefficient use of machinery.
Machinery deteriorates with lack of use.

Solutions:
Casual / unskilled labour migrate to other employment like cottage industries. Many workers are poor farmers who
return to their farms with the extra income earned. Offer incentives to keep skilled labour. Some labor may be retained
to look after the machines.

By-products of Sugar Mill and their uses:

Bagasse:
Chipboards Paper Animal fodder Fuel Electricity

Molasses:
Packaging plastics Ethylene (in chemical industry)

Press Mud/Mill Mud:

This industrial waste is mostly used as soil conditioner, soil fertilizer and for wax production.

STEEL INDUSTRY:
Pakistan Steel Mills Karachi (at Pipri, established with the help of Former USSR)
Imported raw materials: Iron ore, Manganese, Coal.
Locally produced: Limestone, Coal, Water (Haleji lake), Chromite.
Outputs: Pig iron, Rolled and cast billets, Raw steel, Galvanized sheets, Coils
Provides raw materials for engineering and construction industry for heavy mechanical complex Taxila.
Heavy Mechanized Complex Texila (established with the help of China)
It is a heavy engineering center.
Inputs (they are outputs of Steel Mill, Karachi are imported): Pig iron, Rolled and cast billets, Raw steel, Galvanized
sheets, Coils.
Outputs: Tractors / other machinery for agriculture. Machinery / equipment for HEP plants / thermal power plants,
Boilers, Cranes, Construction machinery, Railway equipment.

COTTAGE/SMALL SCALE INDUSTRIES OF PAKISTAN:

BRICK KILN INDUSTRY:
Inputs (raw materials): Coal, oil, wood (as fuel), Clay (the main raw material), Water (usually from a tube well), Capital,
Labour, Land.

Processes: Digging (the earth)- Mixing (the clay and water to prepare paste)- Molding (to shape the paste like bricks)-
Drying (unbaked bricks in sunlight)- Baking / heating (the bricks to make them stronger)

Output: Fired bricks

Importance:
Employment for both males and females- Bricks are used in construction for building houses, offices, bridges and lining
canals. Shortage of wood in Pakistan / wood is expensive so bricks are used in flooring to replace wood. Shortage of
steel due to few steel industries so bricks are used in roofing replacing steel/iron. Cement is expensive so bricks are
sometimes used to reduce construction cost.

Problems:
Bonded labour: Very low wages so labour take loans and are forced to work in the same industry- It includes child
labour- Expensive fuel- Air and land pollution.

Main areas:
Peshawar Potwar Plateau Harappa Bhakkat

INDUSTRIAL ESTATES
Special areas reserved for industries.
Government offers incentives: Exemption from customs or imported machinery- Tax holidays- Electricity / power supply-
Better roads- Private power stations are allowed- Simplified procedures
Examples are: S.I.T.E (Sindh Industrial Trading Estates) Karachi- Hattar Taxila.

Why choose industrial estate?

Employment- Goods for local needs- Goods for export- Increase in GDP/GNP so increases national income- Reduces
imports- Attracts more investors- Development of infrastructure e.g. roads, power, telecommunication- Reduces
emigration & if in rural areas, reduces rural-urban migration- More competition so improves quality of goods- Stimulates
growth of service industries.

What are the benefits and problems of developing new industrial estates? [6]
Benefits
Employment / jobs / raise incomes - Goods for local needs- Goods for export / more trade - Increase GNP / GDP /
increases national income / economic growth -Reduce imports -Attracts more investors / entrepreneurs -Development
of named infrastructure e.g. roads, power, telecomm -Reduces emigration / if in rural areas reduces rural-urban
migration -More competition improves quality -Stimulates growth of service industries
Problems
-Cost - Lack of skilled labour - Loss of agricultural land / trees - Depletion of named natural resources eg. water, gas
-Lack of named infrastructure e.g. electricity, roads, water -Lack of government support -Named pollution e.g. water,
air, land -Need for more imports with e.g. machinery, raw materials, oil (Increases) rural-urban migration.

Problems due to industrial estates

Cost / lack of investment- Lack of skilled labor due to high illiteracy- Loss of agricultural land / trees- Lack of
infrastructure e.g. electricity, roads, water- Lack of government support- Pollution e.g. water, air, land- Need for more
imports e.g. machinery, raw materials, oil- Increase in rural – urban migration.

EXPORT PROCESSING ZONES

These are Special zones / places reserved for manufacture of export products.
It provides several Incentives such as: Tax holidays- Exemption on custom duties (import of machinery)- Simplified
procedure- Relaxation in foreign exchange control.

Q: Why choose Export Processing Zones?

To increase exports and so to increase foreign exchange- Promoting industrial developing- Checking quality- Attracting
investment and experts. Examples are: Landhi, Karachi and Sambrial, Sialkot.

FEATURES OF FORMAL AND INFORMAL SECTORS OF ECONOMY

Formal
Capital intensive- Employment by institution- Regular working hours- Decided wages- Quality of goods- Work in offices /
factories- Legal / registered- Mainly adults / no child labour-Pension schemes

Informal
Labour intensive- Self-employment- Flexible working hours- No fixed wages- Poor quality of goods- At home- May not be
registered- Child labour

Q: Explain the advantages and disadvantages of formal and informal labour.

Formal:
Advantages: Guarantee of products- Warranty available- Can be replaced quickly- Fixed timings
Disadvantages: Expensive- Not available at odd times- Fixed prices (non-negotiable)
Informal:
Advantages: Cheap- No fixed prices (negotiable)- Availability at different timings.
Disadvantages: No guarantee- No warranty- Usually non-replaceable- May not be available at certain times.

Q: Why is fertilizer industry an example of formal sector?

Capital intensive- Fixed timings- Fixed wages- Quality goods.

Importance of cottage and small scale industry

Employment- Women employment- Fulfils local demands- Restricts imports- Saves foreign exchange- Exported e.g.
carpets to Saudi Arabia- Earns foreign exchange- Improves Balance of Payment / Trade
Reduces rural-urban migration as most of them are in villages- Development of rural areas e.g. roads / electricity- It suits
Pakistan’s developing economy as it does not require expensive technology and machines- Waste of large scale industry
can be used to make products here- Contributes to GDP / GNP
Problems
Limited profit- Economy of scale not achieved- Lack of quality- Outdated machinery & methods used- Wholesalers /
middle man makes the most profit- Electricity not available in many villages so work only in day light hours- Limited
training and technical advice available- Lack of marketing- Poverty / lack of finance- Child labour- Illiteracy
Steps to improve
Establishing small industrial estates- Marketing facilities be provided- Technical service centers be established- Pre-
investment counseling and guidance- Loans on easy installment to purchase machinery- Rural electrification
Provision of roads from industries to markets for easy purchase of inputs / easy sale of products- Handcraft
development centers have been established- Organizations like PSIC, SSIC, etc have been established- Tax breaks to
reduce financial burden- Dry ports for exports from inland cities- Telecommunication improvements for better contact
with the market- More use of machinery, thus more value-added goods so more profits

Examples of cottage & small scale industries

Carpets- Wood carving- Embroidery- Jewelry- Sports goods- Surgical goods.

Q: Explain the importance of mechanization to the craft industry and other small scale industries of Pakistan.
Faster- Larger production- Lower labor cost / cheaper- Less work / easy / less tiring- Standardized product / better
quality- Can replace child labour- New skills earned.

SECONDARY INDUSTRY AND ENVIRONMENT

It produces: Air pollution due to smoke- Water pollution due to poor disposal of industrial waste in rivers, lakes,
etc.- Noise pollution due to noise of machinery- Land pollution when industrial waste is dumped underground

Effects
Diseases e.g. deafness, diarrhea0 Contamination of sub soil water effects food crops and supplies of drinking water from
wells- Industrial waste harmful for irrigation of crops- Threat to marine life e.g. fish due to polluted water- Threat to
mangroves due to polluted water

How to control
Awareness campaigns e.g. NGO’s should cooperate- Protests / show of concern by public- Strict enforcement of
environmental laws- Water treatment plants be installed to purify water- Green trees be planted to reduce air pollution-
Industries should be established away from residential areas

TERTIARY INDUSTRY
Service sector e.g. public administration, defence, tourism, etc.
Tourism means the whole business of providing accommodation and recreation facilities for those who are traveling,
staying or visiting a place for a relatively short period of time, primarily for pleasure seeking.

Advantages
Invisible export therefore helps to earn foreign exchange which improves Balance of Payment- Source of employment
for different people like tourist guides- It helps to improved local areas infrastructures e.g. electricity, roads, water,
sanitation, etc.- Provision of other modern facilities e.g. shops- Local tourists can utilize the facilities- Development of
cottage industry e.g. souvenirs- Cultural linkage- Reduces rural- urban migration because many tourists resorts are in
rural areas- Sustainable industry

Disadvantages
Expensive to develop as Pakistan is a developing country- Seasonal employment like tourists (winter or summer or
spring, etc.)- Local culture destroyed- Foreign tourists sometimes do not respect locals and their customs
Litter / garbage (air and land pollution)- Resettlement of local people- Natural habitat destroyed due to deforestation
Facilities may not be affordable for local tourists- Locals may lose their traditional jobs- Political situation and security
situation (threat)

Tourist attractions
Natural tourist sites e.g.Kaghan, Swat, Gilgit, Skardu, Hunza, Chitral
Archaeological e.g. Mohen-jo-Daro, Badshahi Mosque, Shalimar Gardens
Modern buildings e.g. Faisal Mosque, the Parliamentary building in Islamabad.