Economic activities are related to production, distribution, exchange and consumption of goods and services. The primary aim of the economic activity is the production of goods and services with a view to making them available to the consumer. Economic activities can be differentiated into three sectors viz., primary, secondary and tertiary.

1. The primary sector includes all activities that are associated with the use of natural resources like agriculture, fishing, forestry etc.

2. The secondary sector is concerned with the processing of raw materials into products and goods.

3. The tertiary sector is involved with providing service.

All three sectors are interdependent on one another and cannot exist in isolation. For example, cultivation of sugarcane is a primary sector activity. Processing of this sugar cane in factories to produce sugar is a secondary sector activity. Transferring of the sugarcanes to the factories and marketing and selling of the finished product (sugar) is a tertiary sector activity.

Thus, the primary sector is dependent on the secondary sector for payment for the sugarcane produced. The secondary sector is dependent on the primary sector for supply of raw materials to keep up continuous production. Both these sectors are dependent on the tertiary sector for the transportation, marketing and selling of both raw materials and finished goods.