Wednesday, 21 Sep 2016 | 1:29 PM ET
Rupak De Chowdhuri | Reuters
Labourers speak on mobile phones opposite a public call office (PCO) in a market area in Kolkata, India, March 9, 2016.
Western smartphone makers, like Apple and Google, are increasingly looking east for growth, giving countries like India significant influence over the sorts of features they build into their phones.
"Normally what happens in emerging markets is they leapfrog others in terms of forging ahead," said Satish Meena, forecast analyst at Forrester. "India has the advantage of volume — they have sufficient volume so they can tell smartphone makers to build certain features."
"The smartphone makers can then try and use them in the African market, and the Middle East market, for example. The African market has similar problems in terms of purchasing power and penetration of smartphones," said Meena.
India has the fastest-growing smartphone market in the world, accounting for 27.5 million devices sold in the second quarter of 2016, up 17 percent from the second quarter of 2015, according to IDC. Mobile subscriptions are expected to hit 1.4 billion by 2021, according to the Ericsson Mobility Report, released in June.
"Everybody is looking at India as a huge landing ground for their innovation and also as a next big step in that part of the world," said Sanjeet Pandit, Qualcomm senior director for business development and sales for Asia-Pacific and India. Qualcomm's chips are used in about 30 percent of smartphones in India.
The country's 1.3 billion citizens are spread across across a vast geographic area — from modern urban hubs to poor rural villages — which has made delivering payments and services challenging for both the public and private sector, said Forrester's Meena.
The government is promoting a program known as the Aadhaar initiative which assigns a unique identification number to every registered citizen — similar to a U.S. Social Security number — and is encouraging people to submit fingerprints and iris scans.
That biometric information allows people to more easily access government services, such as subsidies, health care and education, or do things like open a bank account or cellphone plan remotely using an Aadhaar-approved cellphone. The government is pushing smartphone makers to create devices for the domestic market which support iris-based authentication technology.
More than a billion people have already signed up for an Aadhaar number, and the program is already helping to combat benefits fraud and greasing the wheels of business.
"The Aadhaar program has been one of the most innovative things that the government of India has launched," said Pandit. "It's not easy to scale such a huge program and collect so many scans across a diverse population and all across the market. They have done a fantastic job in getting that going."