India’s central bank governor, Raghuram Rajan, plans a “dramatic remaking” of banking in Asia’s third-biggest economy.

There will be an expanded role for foreign groups, more licences for domestic private sector institutions and a push to shake up state-backed banks before a new era of robust competition. The recently appointed head of the Reserve Bank of India published new rules this month liberalising the treatment of foreign banks and plans to issue the country’s first new banking licences in a decade next year, as part of far-reaching reforms for the financial services sector in India.

“I see over the next few years a dramatic remaking of the banking landscape,” he told the Financial Times. “Both from the?.?.?.?new banks which are going to come on board and the foreign banks which are going to be allowed to expand more freely. It will be a multiplier in terms of competition.”