Industry body Ficci has mooted the formulation of a 'manufacturing policy' that will spell out guidelines for attaining a 12 per cent growth of the sector annually.

In its suggestion to the National Manufacturing Competitiveness Council, the chamber emphasised the need to formulate guidelines and directions in terms of incentives and subsidies; technology development; development of sustainable raw material base; regulatory and procedural reforms to the manufacturing sector.

The Indian manufacturing sector in the past has not witnessed a consistent growth. While the sector witnessed a robust growth of 11.3 per cent in 2006-07, in the current year it has witnessed a significant slowdown, Ficci said.

As a result, the share of manufacturing would not increase in the country's GDP from the current 16 per cent to 25 per cent by 2015, as targeted, it added.

It is important that the manufacturing sector consistently grows at a rate of over 12 per cent in the next few years, for which it requires an appropriate policy, it said.

The manufacturing sector's profitability has been badly affected in the last few months and the government needs to intervene immediately on both the fiscal and monetary fronts to restrain the slowdown and fall in profitability, the chamber said.

Citing the example of China, Ficci said the communist country has a well-defined manufacturing policy providing incentives and direction for the growth of the sector.