Name: Sectors of the Indian Economy
Uploaded: 2019-07-19
Duration: 6 min 36 s
Description: In this video,we will learn how economic activity is divided into sectors and how each sector is related to the other.

Question

Illustrate with suitable examples the interdependence of the various sectors of the economy.

Accepted Answer

The interdependence of all economic sectors of an economy can be understood well with the help of an example. The case study relating to the production and consumption of clothes can explain the interdependence of all economic sectors.

If any textile industry is established, then this industry requires monetary funds. The owners of this industry arrange monetary funds from the banking institutions. These banking institutions are part of the tertiary sector. The industrialist requires the protection of textile plants from several contingencies, and this protection can be ensured by the provisions of insurance. Insurance companies are classified as the prominent part of the tertiary sector.

The textile industry requires cotton cloth. This cotton cloth can be produced only with the help of cotton. This cotton is obtained by the primary sector of the economy. Industrialist obtains raw materials and cotton from the primary sector. The industrialist converts cotton into cotton yarns, cloth, and garments. The industries are themselves part of the secondary sector. Industrialists supply these garments to the final manufacturers by the way of wholesalers, retailers, and so on. In this scenario, transportation services are used. These transportation services are provided by the tertiary sector.

In the entire scenario, the cotton plants are the production of the primary sector. These cotton plants are obtained by the secondary sector for manufacturing garments. Both of these sectors are supported by the tertiary sector with the help of several services such as banking, insurance, transportation facilities, and so on.

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