The greatest strength for India is going to be its demographic dividend. It is said that in the next 20 years 312 million people will be in the working age group. The greatest challenge for us is to find employment for these people. One revolution that has happened in India is on the literacy front with the education loans from banks picking up and educational institutions coming up in a big way. The literacy levels have increased substantially. But with the increase in the literacy levels there is a flyer for urban life. Thanks to the electronic media – TV and the other things – the glorification of urban life has made people move from rural areas to urban areas.

How do we prevent this migration is going to be a very critical thing which we need to discuss. One way of preventing this migration is to create facilities in the tier II and tier III cities and build infrastructure in smaller towns so that people are in a position to get comforts of urban life in smaller towns. If you think of creating employment, the first thing that comes to your mind is agriculture. But today what we have in agriculture is underemployment coupled with unemployment. Families have grown and land holding has either remained the same or shrunk.

One of the experimentation that gave us very good dividend was formation of Self Help Groups (SHGs). I would say that it created lot of employment for the underemployed and people were gainfully utilised. The SHGs which are created for women have really empowered the women. We have seen in the villages that when the women are empowered the families prosper. One area where we will continue to focus on will be promotion of the SHGS. The SHGs can manufacture and produce goods but when it comes to marketing they find it difficult because they have to compete with the different brands and much better products. How do we create a marketing network for the SHGs is an issue we need to address? The second issue that comes to mind is about SMEs. As we are churning lot of graduates and technocrats the best way is that they get into self employment rather than look for employment outside.

The SME is a very large segment which is not homogenous. But the basic issue in the SME is that we have technocrats who have knowledge and who can produce. But when it comes to managerial or marketing capabilities they face difficulties. And the smaller units are very fragile. They are not in a position to absorb the shocks. How do we create strength in the MSMEs is going to be another challenge for us?

We have just started financial inclusion in a country where 65 per cent of the people are not having bank accounts. How do we bring them into the inclusive growth is the greatest challenge. The financial inclusion starts with opening of an account. We need to give them credit and other financial products so that they are in a position to be a part of the development.

Many people keep their money in boxes. That money is not being channelised for investment purposes. We need to channelise this for productive purposes

ICT based financial inclusion is the other part. We are operating through BCs (Banking Correspondents). We find it difficult to retain BC in the same village. He is also attracted to urban life. He feels ‘why do I do this job for a small amount? Let me move to the urban area’. Instead of making him only a BC, we should give him other avenues to increase his income. The best model for this will be STD booths. When STD booths came, photocopier was put along with it. That made it a sustainable model. Similarly, we need to give BC some more avenues so that he becomes a full-time employed person and he has got a reason to continue in the village.

The services sector is going to be the strength of this country. 57 per cent of the GDP comes from this. The ICT will play a very important role in generation of employment. The software or the knowledge power of the Indian youth is going to be a tremendous strength for us. Our ability to converse in English and go anywhere and work are our strengths.

We’ve seen the delivery of services. In the banking, a lot of things have moved to the digital. Operation of your account, looking at your balance, operating it through your mobile, payment of tax or payment of railway freight – whatever transaction you want to do you can do sitting in your office. If every other service will be delivered digitally it will create tremendous opportunity. These opportunities will be created in the smaller towns. Again the question arises how do we make people stay there?

Huge investments are happening in larger industries. There are issues of capital investment and funding. Earlier we had development financial institutions and the banks. Now for anything and everything – funding requirement – there is only one solution – banks. On Infrastructure funding (power), most of the banks have reached their exposure limits. Where are the new institutions which will fund infrastructure?

The banks will continue to mobilise savings. They will go to rural areas. There are untapped resources. The moment we say financial inclusion, the picture that emerges is that of an unbankable person living in a remote rural area. How about urban financial inclusion? There are so many people living here and keeping their money in boxes. That money is not being channelised for investment purposes. If we can mobilise this, that becomes another avenue for us to invest. We need to channelise this for productive purposes.

Every district should have a RSETI (Rural Self Employment Training Institutes). These institutes are giving vocational training. We in PNB have 34 RSETIs and 10 farmer training institutions where we train the farmers on how to improve their yield so that they can make agriculture viable. Banks have a large role to play. They will continue to be the catalyst in development in the country.