"We have come a long way since we attained Independence 70 years ago. We have expanded our school system, created a number of institutions of excellence. However, we have a huge challenge that has not been adequately addressed," Naidu said at the ThinkEdu Conclave organised by The New Indian Express newspaper here.
"The largest number of illiterate population, most of them women, live in our country. Only about a quarter of children in the country were having access to pre-primary education.
"Without equipping our children, youths and adults with the required knowledge, skills and attitudes, we cannot be a developed nation," an official statement quoted Naidu as saying.
Noting that a large number of kids drop out of school before completing primary education, he said, "We have one of the highest number of out-of-school children in the world."
Stating that India was having a "crisis" of quality as children were not learning the basics even after studying for eight years, he said, "Many young students are graduating without employable skills."
He said there was a "unique opportunity" to reshape the education and everyone who cares about the future of the country "should contribute to the new education policy".
"It is time for us to create a knowledge society. It is time for us to shape a skilled nation. It is time to strengthen our deep roots. We must now get down to making our schools, colleges and universities great places of learning," he said.
Naidu said the country must focus on improving access to pre-primary and elementary education of "good quality".
"We cannot afford to ignore this vital dimension any longer. We cannot build a new India on a weak foundation. We cannot tolerate the high level of illiteracy," he said.
Holding that learning environment in schools must foster all-round development of the individuals, he said, "We should have a curriculum that makes learners, knowledgeable, skillful and responsible."
"We should make the children at the centre of schooling.
The higher education system must focus on research and extending the frontiers of knowledge," he said.