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Meaning and Types of Industry

Meaning:
The industry refers to the application of less labour and more capital in the extraction and manufacturing of material goods. The industry is regarded as the secondary sector of an economy. The contribution of the industry sector to Gross Domestic Products (GDP) is only around 17 %. This shows that the size of the industrial sector is still very small in Nepal. For the rapid economic development of Nepal, the industrial sectors should be promoted.

Types of Industry:
According to industrial policy 2067, the industries of Nepal are classified into 5 groups based on the scale of production and level of investment, which are as follows:

1. Microenterprises:
According to industrial policy 2067, micro enterprises mean the fulfillment of the following conditions:

a) Fixed capital investment, not more than 0.2 million except for the use of the real state.
b) Involvement of entrepreneur, himself on the management.
c) The number of labour engaged are not more than 9 persons including entrepreneur.
d) Not more than two million yearly economic transactions.
e) Consuming less than 10 KW fuel engine capacities.

2. Traditional cottage industries:

a) Uses of traditional skill and technology.
b) Based on Local Raw Material.
c) Related to natural art and culture.
d) A small amount of capital investment.
e) Electricity consuming capacity up to 10 KW.

3. Small scale industries:
Industries with fixed capital investment up to 50 million are known as small-medium scale industries.

4. Medium scale industries:
Industries with fixed capital investment 50 million to 150 million are known as medium scale industries.

5. Large scale industries:
Industries with fixed capital investment more than 150 million are known as large scale industries.