India's new government, led by pro-business Prime Minister Narendra Modi, wants regulators to issue more banking licenses to make the country's financial-services industry more competitive, the head of the Department of Financial Services said Thursday.

G.S. Sandhu, speaking to reporters after a meeting at the Finance Ministry, didn't discuss details about how many licenses should be issued or over what time frame.

Banking licenses are issued by India's Central Bank, the Reserve Bank of India, after consultation with the Department of Financial Services. The bank granted two new banking licenses in April from a field of 25 applicants. They were the first new licenses in a decade.

The central bank is now drafting new guidelines for licenses.