Virtually sidestepping calls for him to become the party's prime ministerial candidate for 2014, Gandhi, 42, speaking in Hindi and English alternatively, said the Congress party "does not focus on leadership development".
The party needs to create 40-50 leaders "who can run the country, not just a state" and also create a similar set of leaders at the state level who can be made chief minister, he said.
Party general secretary Janardan Dwivedi had Saturday said that a decision on whether to make Gandhi the party's face for 2014 polls will be taken later.
Gandhi also stressed on the need to give respect to party grassroots workers and local leaders' voice in deciding ticket distribution in elections. He also said a "young and impatient India" is demanding a greater voice and role in decision making and accountability.
He touched an emotional chord when he related how his mother and party president Sonia Gandhi sat next to him and cried Saturday night, because "she understands that the power many people seek is actually a poison" and she has seen the effect it has on the people and those whom they love.
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His grandmother Indira Gandhi and father Rajiv Gandhi, both prime ministers, fell victim to terrorism.
Gandhi, who has been working for many years for democratization of the youth wing of the Congress, said: "The Congress party is my life, the people of India are my life, and I will fight for the people of India and my party, I will fight with everything I have."
In a speech that touched on the ills of a centralized system of government, he called for empowerment of people. "Until we start to respect and empower people, we cannot change anything in this country... all are closed systems, designed for mediocrity, mediocrity dominates."
Addressing over 1,200 delegates at the All India Congress Committee session here, he spoke about how the party's grassroots workers are overlooked at the time of distributing tickets and candidates are imposed from the party higher-ups. "And then they lose," he said.
The new vice president said his new responsibility was a big one and told party workers that he will treat all of them equally, will learn from their experiences but will only play a judge.
"It is a big responsibility. I will work for everybody from today but I will play the judge and not the lawyer," he said.
He said the time has come to question the "centralised, unaccountable system and decision making must shift from Delhi to the panchayats".
"Why do a handful of people control the entire political space," he asked, adding that "people with little understanding were sitting at high positions".
"We should not chase power for the attributes of power, we should only use it to empower the voiceless", he added, amid thundering applause of over 1,500 delegates inside the 1,300-capacity Birla Auditorium.
Earlier, the All India Congress Committee at the Chintan Shivir endorsed the decision to make him the vice president.
Rural Development Minister Jairam Ramesh, praising how Rahul Gandhi made the Shivir into a youth oriented one, said: "What we are seeing in Jaipur is the Congress's Obama moment".
The Bharatiya Janata Party (BJP), however, said Rahul Gandhi had spoken "more like a leader of the opposition than a leader of the ruling party."
The "Jaipur Declaration", adopted by the Congress after the Chintan Shivir Sunday, appealed to the country's secular forces to join its ideological battle against the divisive forces and condemned the opposition's "obscurantist philosophies".
It also noted the "new aspiration for advancement among the middle class, especially the youth and pledged to speak for them", and reiterated the party's commitment to empower the weaker sections of society, including Dalits and minorities.
Congress president Sonia Gandhi, addressing the delegates, said there was "no reason" the party should not get public mandate again if it works in the right way.