A) Production

  • There are 2 stages:
    • Drilling
    •  Refining

Refining is done in refineries via industrial fractional distillation process which converts crude oil into useful products like petrol, kerosene, diesel. Crude oil is passed through furnace to a column. By increasing temperature, different hydrocarbons are separated. The lightest product reaches to top while heavier ones exit from bottom

B) Location factors

  • Petroleum refining does not lead to significant weight-loss & virtually all by-products can be used therefore refineries can be set:
  • Near Raw material
  • Intermediate Location :
    • In some cases, even coastal fields may have certain disadvantages. For example, coastal waters may be shallow & today most oil tanker ships are very bulky, therefore making it difficult for them to reach coastal oil refineries. For eg. Lake Maracaibo (Venezuela) is shallow.
    • Singapore- has no oil itself but is surrounded by countries which have oil (Indonesia and Brunei). Several refineries therefore are set in Singapore.
    • Banty bay (Ireland)- has very deep harbor & can handle large ships that cannot enter Rotterdam & sail English Channel; therefore, its refineries import oil carried by larger tankers.
  • Near Market:
    • Refinery in urban areas have many advantages (skilled labor, technology, market etc).
    • In Europe & America even though refineries are not located in major industrial region it is said market oriented as it is linked to its users via extensive pipeline networks.
  • Ports and Coastal Locations


Other Factors



Their Importance












Raw material


It is not a decisive factor .Generally refining is not set at raw material sites due to:


a.     Refinery will become useless once oil is exhausted.

b.    Refining does not lead to significant weight loss of raw material.

c.     After 1970’s many middle east and African countries began nationalizing their operations. Therefore, MNCs are reluctant to set refineries in such areas.


1.    Proximity to crude oil decreases transport cost.

2.    Refining begin as soon as oil is brought to surface.

Therefore, countries which have low local demand like middle east, Venezuela etc, they can set refineries near raw material site.





 Strategic reasons


a.     MNCs not interested to set refineries in middle east, South America etc because of instability in the region. Unrest & instability is not good for business.








a.     Middle east & other oil producing areas have little domestic demand because these regions are not so much industrially developed .Their

economics are export oriented. Therefore Petro-chemical complexes located at port facilities eg. Ras Tanura (Saudi Arabia), Mina-El-Ahmadi (Kuwait)

b.    Even the countries which import oil, refineries are set near ports. e.g. USA (refineries are on east coast as it imports oil from Venezuela and Middle East. Pipelines transport finished goods to markets ) In Japan: refineries are at coastal industrial region  ( Honshu Island )





  • Mumbai is hub of petro chemical industry.
  • Industry also located at Jamnagar, [Panipat, Mathura (due to HVJ pipeline)], [Digboi, Ghuwati & Bongaigon (due to availability of crude oil at these sites)],
  • Manglore, Kochi, Chennai, Nagipattinam (due to port location)]


Factor Refineries



Raw material

Reliance (Jamnagar)

·       Import from middle east at Sikka port

·       Direct pipeline from Sikka to Jamnagar refinery



·       Thermal power plants at Sabarmati, Gandhinagar, Ahemdabad, etc.



·       Refineries require skilled labour .Since skilled labor is mobile therefore reliance has industrial township at Jamnagar to retain labour.




·       Close to NH-8.

·       Extensive network of state highways.

·       Sikka port provides export facilities to 25 countries.

D) Synthetic fibres.

  • Produced chemically from petroleum byproducts.
  • Base material for most of synthetic fibers is benzene (obtained from crude oil). Benzene evaporates quickly as it is volatile & hazardous to transport.
  • Synthetic fibers are non bulky, non perishable & therefore easily transported. Industry need not be setup near market location.
  • Industries manufacturing nylon & polyester yarn are located at Kota, Mumbai, Pune, Ujjain, Vadodara & Nagpur.


E) Plastics

  • Polymers are made from ethylene & propylene obtained in refining crude oil. Polymers are raw material in plastic industry.
  • 75% of the industry is in small scale sector. India use recycled plastic as well.
  • 1st Napthalene based industrial setup in Mumbai. Barauni, Mettur etc. are other important producers of plastics.

Chemical industry is highly decentralized & widely spread over the country as  :

  1. This industry is its own largest consumer . Basic chemicals undergo processing to further produce other chemicals used widely in consumer market
  2. Huge market (Soaps, detergents, paints, plastics etc)



A) Production

  • Natural Gas has methane

CH4 + H2o à CO + 3H2

CO + H2o  à CO2 + H2

  • Nitrogen is abundant

N2 + 3H2 à 2NH3

  • NH3 is used to make nitrogen-based fertilizers like Urea. Therefore, nitrogen-based fertilizer plants are located near source of Natural gas.
  • Also, Naphtha (obtained from crude oil after refining) can be used in production of N2 based fertilizers. Therefore proximity to oil refineries is favorable factor.
  • Potash is entirely imported by India as it doesn’t have any reserve of commercial use. Thus, potash-based fertilizers plants are located near ports. India is 3rd largest producer of nitrogenous fertilizers . Green revolution provided more impetus to this industry.

B) Location factors






Gujarat (Hazira, Kalol, Kandla etc) Oil refineries, market, potash imported(ports locations)
UP HVJ pipeline, market, phosphate reserves
Punjab & Haryana Market (green revolution), Panipat oil refinery
Rajasthan Phosphate reserves , Kota near HVJ pipeline


  • India imports 85% of rock phosphate (need for making fertilizers) despite having 250 Million Tones reserves. Annual Demand is 10 million tons. India produces 1.5 million tons with 1.2 million tons alone coming from Rajasthan. India imports rock phosphate from China, US, Morocco, Bangladesh. Rising prices of rock phosphate increases cost of fertilizers in India. Therefore, government provides higher subsidy on fertilizers, this sector is nationalized. Opening up it to private sector would bring in more involvement in exploration & mining.




Long staple



Medium staple



Short staple

Fiber length 32-65mm 22-32mm <22mm
sea island cotton grown in  USA—it is longest variety of  staple cotton







Egypt major producer today USA, Uzbekistan are major producers India, Pakistan are major producers


A) Production

  • Cotton is light weight & nonperishable.
  • In spinning process hardly any weight loss, therefore proximity to raw material site not determining factor in setting up industry (as in sugar, cement, steel industry)
  • In dry climate, cotton threads quickly break during spinning and as a result machine halts & one has to join threads again to restart operation. Therefore, dry climate is not good for mass production. Today, humidifiers can artificially increase air moisture irrespective of climate outside.

B) Location & factors determining it

Textile manufacturing is now widely dispersed industry because:

  • Constant demand from all over the world and it is met by local manufacturers.
  • Mechanization has meant textile manufacturing can be done by partially skilled labour. Therefore, it is an ideal industry for countries where no background of industrial skills.
  • Cotton is grown in many parts of world.
  • Fibre is light, non-perishable & therefore easily transported.
  • Textile industries are located mainly in relation to power & labour supply. Raw material site not important factor in setting up of industry.

C) India

  • One of the oldest industries in India.
  • Development of industry due to following factors:
  • India being a tropical country & cotton is most comfortable fabric for hot & humid climate.
  • India is 4th largest producer of cotton.
  • Easy availability of skilled labour.
  • World War- I & 2 provided impetus to the industry.
  • 80% of cotton textile mills are in private sector.
  • In early years cotton textile industry was concentrated in Maharashtra & Gujarat. Spinning continues to be concentrated in these regions but weaving is highly decentralized due to following reasons:
  • Cotton textile is not weight-losing nor weight gaining therefore raw material site is not important factor for setting up this industry.
  • It provides scope for incorporating traditional skills & designs of weaving form different parts of India.
  • Historical factors like emphasis on charka by Gandhi have helped it spread to even remotest villages.
  • Labour is easily available.
  • Government policies of keeping mill sector loomage lower than powerloom & handloom. Therefore self employment in this sector is increasing.
  • Local markets are everywhere .Market decides what kind of cloth is to be produced. Therefore, it is important to locate mills near market.
  • Tamil Nadu has largest number of mills. Maharashtra ,Gujarat and Tamil Nadu are leading producer of cotton




Of India )


Ahmedabad Coimbatore



Raw material

1.Short & medium staple cotton from regions of Maharashtra

2.Long staple imported from Egypt

1.Gujarat leading producer of cotton 1.Tamil Nadu leading producer of cotton


Water for bleaching



1.Mithi river


1.Sabarmati river


1.Noyyal river




1.Tata hydroelectric grid


1.Sabarmatic thermal power pant



1.Pykara hydel project




1.Mumbai & rest of India.

2.Exports from Mumbai port



1.Gujarat & other states.


1.Southern states & part for export.

D) Problems:

  • Many of our spinners export cotton yarn while garment manufacturers import garments because our weaving sector is highly fragmented & technologically backward. Weaving & knitting processing units cannot use much of high-quality yarn produced in country & therefore it has to be exported. But in weaving sector high value addition is done & need is to progress this sector.
  • Good quality long staple cotton imports increasing.
  • Power supply is erratic.
  • Competition from synthetic fibers.
  • Production in organized sector has fallen form 81% in mid-20th CE to 6% in 2000 . Power looms & handlooms in decentralized sector produce 59% & 19% of all cotton produced

E) Major Textile centres and their location

Factors Osaka , Japan Manchester & Lancashire New England ( USA) Southern-Eastern USA Shanghai , China



Raw Material

Cotton is imported from India , Egypt etc @ Osaka Port. Cotton is imported from India & Egypt @ Liverpool Port. US cotton belt region produces long staple cotton. Yangtez-Kiang Delta is good for cotton Cultivation. China is the largest producer of cotton






Osaka is located on coast => Humid climate which is good for spinning. Liverpool is on coast => Humid climate. Moist westerlies also maintain optimum humidity levels. Shanghai is a port city => Humid climate.




Osaka Hydel power station Coal from Appalachian region Hydro-electricity power along all major rivers Hydroelectricity power ( Yanztez river )
Water ( required for bleaching & dyeing ) Yodo River Yanztez River




Osaka port and Osaka Railway junction Liverpool Port and Manchester Ship Canal Boston and New York Port Shanghai Port and inland water transport ( Yantez River )



Local Market and exports to Australia and Asia Demand in Europe and exports to US Local Demand Local Demand Local Demand and exports to South Korea , Taiwan etc
Other Factors Automation levels are high , so labor is not an issue This region has little scope of expansion due to mountainous topography. Now it is mainly concerned with high end fashion products. Vast land provides great room for expansion



Today 95% of American cotton textiles are located in south & New England is no longer a textile hub? Why?

Reasons: –

  • Industry was not drawn to South by presence of raw material (for cotton is light & non-perishable, therefore less transport cost)
  • South had cheap labour (earlier black slaves).
  • Power supplies in south: Hydroelectricity began to be developed at the fall line & along major rivers like Tennesse.
  • South had better communication with rest of country than New England as New England was cut from western parts of USA by mountains. Also, there was no room for expansion in new England region due to this.
  • Only cotton textile industry located in new England is concerned with very high quality & specialized fabrics for New York fashion center.
  • When synthetic fibers began to be imported, south had another advantage that it possessed many pulp mills where cellulose can be produced.



  • India is the largest producer of raw jute & jute goods & 2nd largest exporter after Bangladesh.
  • Industry highly concentrated in West Bengal and factors responsible for it are:



Raw material

·       85% of jute cultivated in Ganga delta.

·        It is one of the few crops that can withstand flooding in the region



·       Jute requires large amounts of water. Besides jute processing require  more water for washing, bleaching, retting




·       West Bengal, Bihar, UP.




·       Kolkata provides banking, insurance etc.




·       Kolkata port, Hugli river

·       Good network of railways nowadays


  • Synthetic substitutes.
  • No fresh investments.
  • Stiff competition from Bangladesh, Brazil etc.
  • Lack of marketing strategies to promote jute as ecofriendly product.
  • Increased dependence on government procurement (example swatch Bharat is being linked to jute bags)



A) Production

Sugar mill Sugar refinery







Raw coarse brown sugar





1.Sugarcane is crushed to get sugar juice

2.Sugar juice is sulphonated for bleaching.

3.Lime is added

4.Boiling & crystallization is performed



1.Refining of brown sugar




1.Raw coarse brown sugar

2.Baggage (which can be used as  fodder, to generate energy, in paper pulp industry etc)



1.White sugar.




1.Near sugar farming areas.


1.Anywhere but in countries like Japan which rely on imports, location is around ports.



B) Location factors

1.Perishable: Sugarcane contains sucrose which begins to dry during haulage after being harvested from field. Better recovery of sugar is dependent upon its being crushed within 24hrs of its harvesting.

2.Weightloss: Sugar accounts for ~ 9-12% of bulky sugarcane, therefore expensive to transport sugarcane over long distance.

C) India

  • Sugar industry is second most important agro based industry in country
  • India is largest producer of sugarcane & cane sugar. It contributes 8% of sugar production in world.
  • provides employment to ~4 lakh persons directly.
  • 60% of sugar mills are located in UP & Bihar.
  • Industry is seasonal in nature so ideally suited to cooperative sector. (why because Cooperative sector industries are owned and operated by producers / suppliers of raw material, workers or both. They pool in resources and share profits or losses proportionately. Sugarcane is a mono-culture crop as well as perennial)
  • Tendency to shift mills to southern states.
  • Cane produced here has higher sucrose content.
  • Climate is cool. So long crushing period is available.
  • Cooperative societies are more successful here.


Factor Maharashtra UP

Cuba( Sugar




1.For sugar, warmer climate implies better yield

2. No loo, no frost & moderating effect of ocean.

1.Warmer + humid climate




1.Black soil=fertile, retains water, so good growth of sugarcane.

1.Potash-lime in soil helps in growth.

2.High Fertility.

1.Fertile calcareous soil.




1.Bagasse as fuel 1.Bagasse as fuel 1.Bagasse





Govt policy

1.(see sugar pricing) 1.(see sugar pricing)

1.After 1959 most sugar exported to USSR

2.Castro nationalized plantations, redistributed them among workers which led to increase in price due to higher costs of production

3.New cooperative system was introduced



1. Local 1.local




D) World production in cane sugar

  • India (20% of world total);
  • Brazil (16%)[ Portuguese intro sugar here ]
  • Cuba (10%)

E) Rangarajan Committee recommendation’s

Government Control factor Recommendation Its Implication


Sugar Crop Area

Do away with reserved area and give farmer option to trade with any mill. This would be empowering the farmer to do better business.
Mill Distance Do away with minimum distance between mills. This would enable competition
Pricing of Sugar  Give the farmers Fair Remunerative Price timely. Putting proper system for remuneration.
Packaging Do away with the jute packaging It can save about 1000 crores as Jute packaging is expensive as compared to its synthetic alternatives
Levy of Sugar Do away with the mandatory 10% sale to the central government. Instead, pass on the subsidy to state government, which can buy the sugar from the market and give it subsidized. It can ease central subsidy substantially. The levy savings is about 2000 crores.



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