While many smartphones are available in the market at that price, most do not have 'functional' features or the software does not support all apps available in the market.
Since launching Android in late 2007, Google has been aiming to develop devices with the functions of smartphones that are priced in a range the mass market can afford.
Around March last year, Google's executive chairman Eric Schmidt had said the day was not far off when a basic smartphone with a web browser and web-client apps would be available in the market at a price of around $50 (approximately R3,000 at todays exchange rate).
He had also admitted that Google was always encouraging phonemakers to produce cheaper sets with web-browsing features so that mobile-based internet penetration gets a further fillip.
"Software can be utilised to make smartphones cheaper without compromising on its functionality, said Anandan at Express Group's Idea Exchange programme.
According to technology analysts, when Google released its latest version of Android, KitKat, one of the most significant changes was an overhaul specifically intended to ensure that the newest features and functions work on lower-end handsets.
In Android 4.4 KitKat, Google made the profile of the operating system fit into smartphones so that they work on devices that run on as little as 512MB of RAM.
Anandan added that India has a huge potential for internet penetration through the smartphone. "Compared to the US, where there are around 250 million mobile-based net users, and China, which has 200 million users, India will have over 300 million users by next year. That is a huge market," he said.
He added that highly affordable devices, affordable data plans and robust bandwidth will support the internet boom in India. Google is focusing on how to get half-a-billion Indians on the internet, Anandan said.
The overarching strategy is to help digitise India. It took 10 years to go from 10 million to 100 million users, three years to go from 100 to 200 million and we will be 300 million in 2015. Until we get to 500 or 600 million, the impact of what the internet can do in India will not reach its potential.
He added that the three pillars for Google to achieve this target are getting more people online, specially women; getting more content online and getting businesses online.