best from the demographic dividends and rapid urbanization. this would require increased resource allocation and resource generation in activities like education, health, urban and rural infrastructure. it would require efforts to bridge energy demand - supply gaps, new investments in renewable energy and stepping up mineral exploration. we need to do more to remove factors that might constraint future growth. ii what policy imperatives are needed to push the potential or macro - economically sustainable growth rate up? as i had mentioned, i would discuss three sets of policy imperatives. making growth process more inclusive india has been a remarkable growth story for the last decade all right. however, the growth process has not been very inclusive. there are several indicators that would leave us uncomfortable with the current growth process. according to the united nation ’ s development program ( undp ) ’ s human development index ( hdi ), 2010, india was placed at a rank of 119 amongst 169 countries, which is clearly not in sync with india ’ s economic strength. almost all our competing emerging market economies including malaysia, russia china, sri lanka, thailand, philippines, indonesia and vietnam have better hdi rankings than us. india ’ s relative position has not improved very much over the years, with a rank of 77 amongst 95 countries in 1980 and a rank of 95 amongst 118 countries in 1990. this may not be surprising once we consider that we spend only less than 3. 5 % of gdp on education, ranking 117th amongst 142 countries and comparing poorly with countries like lesotho and cuba that spend 14 % of their gdp on education and botswana that spends 10 %. we spend just 1 % of our gdp on public health services and rank a dismal 181 amongst 188 countries ranked in terms of hdi indicators. small countries like kiribati and marshall islands spend 14 % of gdp on this and cuba spends 9 %. most oecd countries spend 6 – 9 % of their gdp on public health services. rapid growth has made a dent on poverty, but perhaps not enough. over a quarter of our population still lives below the poverty line. based on national sample survey ( nss ) ’ s 61st round, the poverty ratio was 27. 5 % in 2004 – 05, with 28. 3 % in case of rural areas and 25. 7 % in case of urban areas. however, these ratios compare well with those in 1993 – 94 which were 36. 0 % at all - india level, 37. 3 % in case of rural areas

surmounted and pave the way for a massive disruption in the way banking is conducted today. ( ii ) how long can the banks continue increasing their retail loan portfolio? unless some means to pool and distribute these loans to other investors in the market is created, the retail lending pipeline can get chocked quite quickly. ( iii ) how is crowd funding going to impact lending business of the banks in future? the amount of funds raised by crowd funding platforms worldwide has increased progressively from $ 1. 5 bn in 2011 to $ 2. 7 bn in 2012 and further to $ 5. 1 bn in 2013. i hear some of you say it is negligible in volume. the pace of growth however, is quite fast and combined with bis central bankers ’ speeches the peer - to - peer lending business this could create disruptions, at least for some of the players who operate in the same segment. ( iv ) if mobile banking were to succeed, would plastic money still be needed? basically there are two questions rolled in one. first, whether mobile banking can succeed and if that is the case what implications would it have for the future of atms and the debit cards that have been issued by banks. there is justifiably a growing need for reducing the reliance placed on cash by the system and hence, if more and more people moved to mobile / internet based payments, the plastic cards and the investments made thus far, would be rendered useless unless put to more imaginative uses. ( v ) what ifrs implementation would mean for the banking system? ifrs accounting could potentially overstate assets or overstate capital position. the question is how prudential regulation would exist alongside ifrs? proposed impairment calculations under ifrs, accounting for interest income on effective interest rate basis and presence of multiple systems for operations and accounting of different portfolios would mean that it systems would have to be upgraded / realigned for ifrs migration. banks would also need to overcome challenges around converging policies for financial accounting and tax accounting for preparation of financial statements. the banks would need to train their staff in various departments like credit, and treasury, etc. for acquiring proficiency in ifrs accounting. ( vi ) would the large corporates continue to borrow from the banks? of late, the global markets, particularly the emerging market economies, have been flush with funds flowing in on account of variants of qes launched by the central banks in the advanced economies. many large corporate houses have been able to access