UPSC Civil Services Model Paper 8

Footloose industries can be located in a wide variety of places.
They are not dependent on any specific raw material, weight losing or otherwise.
They largely depend on component parts which can be obtained anywhere.
Hence statement 1 is correct .
Diamond and Computer chips industries are types of footloose industries.
Hence statement 2 is correct.
The cotton textile industry uses a non-weight-losing raw material and is generally located in a large urban centre, e.g. Mumbai, Ahmedabad, Surat etc. butit is not a footloose industry as it requires agro-based raw material.
These are called footloose as these types of industries are prone to relocation.