The iron and steel industry is the basic industry since all the other industries — heavy, medium and light, depend on it for their machinery. Steel is needed to manufacture a variety of engineering goods, construction material, defence, medical, telephonic, scientific equipment and a variety of consumer goods. Production and consumption of steel is often regarded as the index of a country’s development. Iron and steel is a heavy industry because all the raw materials as well as finished goods are heavy and bulky entailing heavy transportation costs. Iron ore, coking coal and lime stone are required in the ratio of approximately 4 : 2 : 1. Some quantities of manganese, are also required to harden the steel.

In recent years, there is a tendency for the mills to shift and concentrate in the southern and western states, especially in Maharashtra, This is because the cane produced here has a higher sucrose content. The cooler climate also ensures a longer crushing season. Moreover, the cooperatives are more successful in these states. Major challenges include the seasonal nature of the industry, old and inefficient methods of production, transport delay in reaching cane to factories and the need to maximise the use of baggase.

India is the largest producer of raw jute and jute goods and stands at second place as an exporter after Bangladesh. Most of the mills are located in West Bengal, mainly along the banks of the Hugli river, in a narrow belt. Factors responsible for their location in the Hugli basin are: proximity of the jute producing areas, inexpensive water transport, supported by a good network of railways, roadways and waterways to facilitate movement of raw material to the mills, abundant water for processing raw jute, cheap labour from West Bengal and adjoining states of Bihar, Odisha and Uttar Pradesh. Kolkata as a large urban centre provides banking, insurance and port facilities for export of jute goods.