The syntax for %%INCLIB and %%INCMEM are:
//* %%INCLIBDataSetName %%INCMEMmember
or
//* %%INCLIB DDNAME=ddName %%INCMEMmember
DataSetName or ddName must be exported as an environment variable and point to the folder where the file that defines member is found. Otherwise, the catalog is used. Extensions are not used in the syntax.
You can specify multiple paths with concatenation if using ddName. Each path is separated by a semicolon (Windows) or colon (UNIX/Linux).