Mumbai: The government will set up five manufacturing investment regions (MIRs), on the lines of special economic zones (SEZs). The MIRs would cover a larger area of 100sq km and may include the SEZs as well, commerce and industry minister Kamal Nath said in New Delhi on Tuesday.

These regions might include SEZs, industrial clusters, IT parks, export oriented units and other such established schemes. "The units located within these regions would get the benefit of world-class infrastructure but no specific fiscal incentives," he said.

The government will further liberalise norms for foreign direct investment (FDI) for manufacturing units in the MIRs to give a boost to the manufacturing sector, the minister said, adding, more weightage would be given to leather, pharmaceuticals and engineering goods industries.

He said the government is weighing various options while the focus is on removing procedural bottlenecks.

FDI inflows into the country''s manufacturing sector has risen by 75 per cent to over $2 billion in 2005-06, Nath said, adding, the government aims to double these inflows over the next two years.

While the manufacturing sector grew by 10.4 per cent in May this year, the government is aiming at a 12 per cent growth, covering all industrial activities except power, water supply and mining, he said.

Alongside, the government is also formulating a policy framework for petroleum and petrochemical investment regions (PCPIRs), covering an even larger area of over 250sq km.

Kamal Nath said the MIRs would support industries where the country has a distinct advantage and may not require any separate legislation.

He said five coastal states of Orissa, West Bengal, Karnataka, Gujarat and Andhra Pradesh had already made presentations and were in the process of finalising their action plan to establish these regions.

Nath said the prime minister''s council on trade and industry would consider the recommendations of the Investment Commission headed by Ratan Tata next week. The government is also considering options for retail sector FDI as it wants to ensure that it would generate additional economic activity and do not displace existing ones, he added.