The factors affecting the location ofindustry'are grouped into physical and human factors.
(i) Availability of Raw materials The factory needs to be close to the location of raw material if they are heavy and bulky to transport. For example, iron and steel industry is located near the source of raw material.
(ii) Water Source Water is an important factor that
determines the location of industries. Water is required for various industrial processes. River water and waterfalls can also be used to generate hydroelectricity.
(iii) Climate Climate plays a significant role in establishment of industries. Harsh climate is not much suitable for industries. Extremely hot, humid, dry or cold climate is not very conducive for industries. For example, cotton textile industry requires humid climate because thread breaks in dry climate.
(i) Labour A large and cheap labour force is required for labour-intensive and manufacturing industries. High-tech industries have to be located where suitable skilled workers are available.
(ii) Capital This is the money that is invested to start a business. The amount of capital will determine the size and location of the factor.
(iii) Government Policies Industrial development is encouraged in some areas and restricted in others. Industries that are located in depressed areas may receive financial incentives and assistance from the government in the form of low rent and tax rates.