So the problem was that the Radius Networks IBeacon Android service was not registered.
as David pointed out the manifests of the the library project and application project needed to be merged.
To merge manifests you must add the following line to project.properties file of application project.
manifestmerger.enabled=true
For me, that did not work so I took the contents of the library projects manifest and put them in the manifest of the application project.
All is working now.