The country's top bankers have gathered in Pune in a one-of-a-kind huddle to discuss long-pending reforms vital to improving the health of ailing public sector banks in Asia's third-largest economy.

Besides the heads of all public sector banks, the two-day meeting ending on Saturday will also be attended by Prime Minister Narendra Modi, Finance Minister Arun Jaitley and Reserve Bank of India Governor Raghuram Rajan.

India's more than two dozen state-run banks have been constrained by a pile of bad loans and corporate governance issues. They also lag their private sector rivals in profitability. For years, political interference and union opposition have thwarted major reforms. If reformed, however, the country's mega state lenders offer investors the best exposure to any sustained upswing in India's economy.

"When the country is trying to achieve accelerated growth in economic development it is absolutely essential that banking reforms are thought about, deliberated upon and implemented also," said Hasmukh Adhia, Financial Services Secretary in the Finance Ministry.

The issues to be discussed include industry consolidation, restructuring of state banks for better efficiency and governance, as well as asset quality.-- Reuters.