He talked about plans to build 100 smart cities in the country to generate employment while noting that urbanisation should be treated as an opportunity rather than a problem.
"If India has to compete with China, the focus should be on skill, scale and speed," Modi said after releasing a book 'Getting India Back on Track – an action agenda for reform' at his residence here.
His mention about competing with China significantly came on a day when Chinese Foreign Minister Wang Yi is in India and held talks with External Affairs Minister Sushma Swaraj on ways to cooperate, particularly in the field of economy and trade.
Noting that 65 per cent of India's population is below 35 years of age, the Prime Minister said the country needs to exploit the demographic dividend. "For this skill development needs to be a priority area," he said.
Referring to skills such as teaching, nursing and paramedics, he said good teachers was one of the biggest needs of society, but rued that there were very few good teachers available.
"Can India become an exporter of good teachers who would capture the imagination of an entire generation globally," the Prime Minister asked.
Modi cited the three colours of the national flag while speaking on the need to develop key sectors for overall growth of the country.
Beginning with green, he said India needs to bring about a second green revolution focusing on increased agro-productivity, value addition, agro technology, and decentralisation of warehousing.
Modi said a white revolution must focus on increasing milk productivity and developing a support system for ensuring cattle health.
"Saffron colour represents energy – and we need a saffron revolution that focuses on renewable energy sources such as solar energy to meet India's growing energy demand," he said.
Referring to safforn in the National Flag, he said his mention of the colour would have alerted some people but "safforn is the colour of energy".
"We have the gift of solar radiation but we have not yet utilised that," he said.
Citing the example of America, Modi said earlier the US was dependent on Gulf countries for their energy requirement but now they have the potential to provide gas to the world.
"Can't we think in that direction," he posed.
In a lighter vein, Modi also spoke about how difficult it would be to ensure that the country returns to high growth path.
India's economic growth remained below the 5 per cent mark for the second year in a row at 4.7 per cent in 2013-14.
"...but we have the backing of the people and we will bring back the growth at higher trajectory," he said.
He said, in infrastructure, the focus needs to shift from highways to "i-ways", and optical fibre networks.
"Cities in the past were built on river-banks. They are now built along highways. But in future, they will be built based on availability of optical-fibre networks and next-generation infrastructure," he said.
Modi said the "input of intellectual think tanks" should be substantially enhanced for better policy frameworks.
While talking about agriculture sector, he said no work has been done in the last 50-60 years to increase production of pulses.
"How we can increase per hectare pulses production?...the big challenge is that how to increase protein content in our pulses," Modi said, adding, "Farmers are dying. About 30 per cent of our produce get wasted due to lack of proper warehouses. We need to decentralise the warehouse concept."
On skill development, the Prime Minister said India has the capability to prove skilled manpower not only to India but to the world also.