The sectoral classification of economy is seen as a continuum of distance from the natural environment. The continuum starts with the primary sector. 

Primary Sector: There are many activities that are undertaken by directly using natural resources and the output is natural too. Production of crops using soil rain etc. Similarly, minerals and ores are also natural products. When we produce a good by exploiting natural resources, it is an activity of the primary sector

Secondary Sector - The secondary sector covers activities in which natural products are changed into other forms through manufacturing that we associate with industrial activity. It is the next step after primary

Tertiary Sector - third category of activities that falls under tertiary sector, help in the development of the primary and secondary sectors. These activities, by themselves, do not produce a good but they are an aid or a support for the production process. For example, goods that are produced in the primary or secondary sector need transportation service to be sold in shops. Some essential services may not directly help in the production of goods.

Quaternary Sector - is an extension of three sector hypothesis. It comprises intellectual services e.g. inform generation, information sharing, consultation. Some expert argue that intellectual services are distinct enough to warrants a separate sector

Quinary Sector –also known as golden collar sector consists of highest level of decision makers in any sector or department be it government, businesses and media.Sometimes it considered to comprise of health, education, police, fire services and other govt industries not intended to make a profit etc.

Division of sectors as organised and unorganised

Organised sector covers those enterprises or places of work where the terms of employment are regular and therefore, people have assured work. They are expected to work only a fixed number of hours. They are registered by the government and have to follow its rules and regulations which are given in various laws such as the Factories Act, Minimum Wages Act, Payment of Gratuity Act, Shops and Establishments Act etc. It is called organised because it has some formal processes and procedures

Unorganized sector is characterized by small and scattered units which are largely outside the control of the government. There are rules and regulations but these are not followed. Jobs here are low-paid and often not regular. There is no provision --overtime, paid leave, holidays, leave due to sickness etc. Employment is not secure. People can be asked to leave without any reason.

other ways of classifying Indian Economy

Indian economy can be understood in terms of a number of dichotomies. These dichotomies are the result of nature of Indian economy, geographical factors, historical developments, Government policy.

• One-way is suggested by the definition of the mixed economy itself. The division into the Public and the Private Sectors based on ownership of the enterprise.
• Again, it is sometimes useful to describe a developing economy by dividing it into two broad sectors according to habitation in towns and villages, viz. the Urban and Rural Sectors. The Tertiary Sector produces not goods but services.  Trade, communication, administration, transport, banking and other services belong to this sector.

Apart from the divisions into sectors along the lines of ownership of the enterprise, the type of the activity and urban-rural habitation, and federal structure of the Indian economy indicates the importance of its division in another way: division into regions or the states.