This chapter will discuss the role of industrialization in shaping structural transformation and economic growth for sustainable development. It will explore how certain aspects of sustainable consumption and production (SCP) are linked to industrial development and can further enhance sustainable industrialization. While it is generally understood that structural transformation and industrialization are required to achieve poverty reduction and substantial improvements in socio-economic conditions in developing countries, the role of industrial policy has been the subject of a long and varied debate, which at times obstructed a more important discussion on the content, efficacy and strategic priorities of those policies. The chapter will review the assessment of the role and application of industrial policy for sustainable development in the current macroeconomic context and taking into account new global economic and environmental challenges. It will highlight inclusive and sustainable industrial development as a strategy to promote and incentivize sustainable economic growth. It will also address the use of industrial policy for development of green industrial sectors and the greening of industrial production, which are central to sustainable structural transformation and industrial upgrading in all countries.

Key questions to be addressed:

• What is the role of industrial policy for achieving inclusive and sustainable economic growth to support the post-2015 development objectives?
• How can industrial policies be used to facilitate transformational change to sustainable development and to incentivise resource efficiency and sustainable production and consumption?
• What other supportive measures have worked and could be scaled up to facilitate a shift towards more resource efficient and sustainable production and consumption patterns?