Question

What is Cottage Industry? Throw light on the importance and problems of cottage industries.

Answer 1

Cottage Industry:- An industry where the creation of products and services is home-based, rather than factory-based while products and services created by cottage industry are often unique and distinctive given the fact that they are usually not mass produced, producers in this sector often face numerous disadvantage when trying to compete with much larger factory- based companies.

This importance and problems of cottage industries:-

Cottage and small scale industries are labor intensive and provide employment to $80\%$ of the industrial labor force.

This reduces unemployment and offers opportunities for self-employment.

These industries also meet the local demands for industrial goods and save foreign exchange spent in imports. This is the importance of cottage industry.

Some of the major problems forced by Indian iron and steel industry are as follows:-

$\left(1\right)$ Capital

$\left(2\right)$ Lack of Technology

$\left(3\right)$ Low productivity

$\left(4\right)$ Inefficiencyncy of public sector units.