ii ) macroeconomic management involving fiscal reform and monetary policy in an open economy context. 7. the new challenge are : how to bridge the gap between a growing demand for different skills as the economy resumes its journey on a high - growth path, and their supply. the demographic opportunity needs to be turned into a dividend : today, 50 per cent of india ’ s population is under 25 years of age. aspirations are rising. the demographic opportunity is increasing for india because the percentage of population of working age will continue to increase for another 40 years. this needs to be harnessed with greater focus on skill building, higher education, innovation, knowledge creation, and knowledge sharing. the government of india ’ s national skill development initiative uses public - private partnership to address this challenge. india is uniquely placed for attracting investments in education because there is a hunger for education in emerging economies and a strong commitment to education at the family level. global educational institutions will have to look at building a presence in india as they will have to gravitate where human resources are available. 8. in the coming years, millions of people in india are expected to move out of the agricultural sector and that jobs will have to be provided for them. india, therefore, needs to increase its manufacturing capability. though in the recent past, the growth of the manufacturing sector has generally outpaced the overall growth rate of the economy, at just over 16 percent of gdp, the contribution of the manufacturing sector in india is much below its potential. every job created in manufacturing has a multiplier effect of creating two to three additional jobs in related activities. therefore, a thrust on manufacturing is integral to the inclusive growth agenda of the government. the national manufacturing policy announced by the government of india proposes to increase the sectoral share of manufacturing in gdp to 25 % over the next decade. 1 9. as we capitalize on these strengths, i see india delivering on the aspirations of a young and growing middle class. and we will do so while increasing our integration with the world. india is now closely integrated with the rest of the world both by way of financial integration and trade integration. it is the intent and objective of the government of india to attract and promote foreign direct investment in order to supplement domestic capital, technology and skills, for accelerated economic growth. while india can look at an 8 % growth based on domestic opportunities, for a 9 – 10 % growth to occur the external environment has also to be hospitable b

and even brics economies having over 40 branches. regionally, north - eastern, eastern and central regions are more excluded in terms of banking penetration. given the fact that there is a large unbanked population in the country and a large informal sector that still does not have access to the formal banking sector, there is considerable scope for the expansion of india ’ s banking sector. this would also require greater presence of private entities at national and local levels. the assessment and comparison with other economies brings to the fore the need for imparting dynamism through expanding the commercial banking system in terms of its size and number of banks ; need for expanding smaller banks in unbanked and under banked areas ; need for focus on consolidation ; need to relax barriers to entry for improving competition ; and the need for enhancing operational efficiency. 13. with a view to ensuring that the banking system grows in size and sophistication to meet the needs of a modern economy and improving access to banking services, reserve bank of india is considering giving some additional banking licences to private sector players subject to their meeting our eligibility criteria as announced by the union finance minister in his budget speech for the year 2010 – 11. consequently, the reserve bank of india, released the guidelines for “ licensing of new banks in the private sector ” 2 on february 22, 2013. rbi is in the process of issuing new bank licenses consistent with the highest standards of transparency and diligence. further, reserve bank has recently ( on august 27, 2013 ) released a discussion paper on “ banking structure in india – the way forward ” 3 which is placed on the website for comments from stakeholders. the document explores the possibility of differentiated licences for small banks and wholesale banks, the possibility of continuous or “ on - tap ” licensing, and the possibility of converting large urban co - operative banks into commercial banks. we propose to carry forward these ideas and come up with a guidelines for licensing of new banks in the private sector released by reserve bank of india on february 22, 2013 and accessed from http : / / rbi. org. in / scripts / bs _ pressreleasedisplay. aspx? prid = 28191. discussion paper on “ banking structure in india – the way forward ” released by reserve bank of india on august 27, 2013 and accessed from http : / / rbi. org. in / scripts / publicationreportdetails. aspx? id = 713. bis central bankers ’