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Primary, Secondary, and Tertiary sectors

Updated: 6 days ago

Economic activities can be classified in various forms. One such form is the ‘Three-sector’ model. The ‘Three-sector’ model divides the economy into three parts: primary sector, secondary sector, and tertiary sector.

Sectors of Indian Economy

The Primary Sector 

It comprises economic activities like farming, fishing, forestry, and mining. This sector provides the basic components for various goods and services. People engaged in primary activities are called red-collar workers due to the outdoor nature of their work.

In developing and underdeveloped nations the primary sector often accounts for a larger share of the national income as compared to developed nations. Also due to technological advancement in developed nations; less workforce is employed in the primary sector. While the developing and underdeveloped nations have a higher proportion of workforce in the primary sector. 

The Secondary Sector 

It is mainly concerned with manufacturing work. It involves the process of converting raw materials into usable products. Since this sector is associated with different kinds of industries, it is also called the industrial sector. Automobile, textiles, chemicals, electrical, energy, metallurgical, construction (infrastructure), and food processing are a few examples of industries of the secondary sector. People engaged in secondary activities are called blue-collar workers.

The primary sector provides the raw materials needed by the secondary sector. Nations that are mainly dependent on the primary sector, typically grow slowly and remain underdeveloped or developing economies. The value added by converting raw materials into finished goods consistently generates higher profitability, which helps in faster economic growth.

The Tertiary Sector 

It can be mainly considered as a service sector. Services are nothing but intangible goods. Tertiary sector helps in the development of secondary and primary sectors. People engaged in tertiary activities are called white-collar workers. This sector is well organized and uses modern-day techniques to perform its functions. A few examples of the tertiary sector are financial services (banking, insurance, investment), health care, hospitality, education, information technology, transportation, and professionals like lawyers, accountants, architects, and so on. Within the domain of the tertiary sector, the higher-level services are further subdivided into quaternary and quinary activities. 

Indian Economy

Quaternary activities 

They are specialized tertiary activities that fall under the umbrella of the "Knowledge Sector" and require a separate classification within the tertiary sector. In recent years, both the supply and demand for information-based services, such as those offered by tax experts, software developers, and investment consultants have increased significantly. Many forms of quaternary services are outsourced to other countries. 

Quinary activities 

They are another subdivision of the tertiary sector. Quinary activities comprise services that involve R&D, innovation, policy-making, data interpretation, and technological advancement. The people involved in this sub-sector are limited in number but their contributions have immense impact. The personnel in the Quinary sector are often called ‘gold collar’ professionals.

As discussed above, in a developing nation primary sector plays a major role– with most people employed in agriculture and allied activities. As the nation develops, with improved technology less workforce is needed in the primary sector. This allows people to shift to the secondary sector and produce manufactured goods. With further technological development and rising level of education, people move towards the tertiary sector making the service industry the backbone of the economy.

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