Google has joined Facebook in backing Indian telecom network Jio Platforms, as part of a planned $10bn (£7.9bn) investment by the search engine into the country.
The search giant said it had paid $4.5bn for a 7.7pc stake in Jio, a digital subsidiary of Reliance Industries - run by India's richest man Mukesh Ambani.
It comes just three months after Facebook took up a 10pc stake in Jio, in what was said to be the biggest ever foreign investment in an Indian company.
Jio's other shareholders include General Atlantic, Intel, Qualcomm and Vista. The company accounts for around a third of the Indian mobile market, and has a significant 4G network.
Google said it would be working with Jio to develop an affordable, entry-level smartphone with a customised Android operating system and access to Play Store.
Sundar Pichai, Google's chief executive, said that "getting technology into the hands of more people is a big part of Google’s mission".
“Together we are excited to rethink, from the ground up, how millions of users in India can become owners of smartphones. This effort will unlock new opportunities, further power the vibrant ecosystem of applications and push innovation to drive growth for the new Indian economy."
The investment will come out of the $10bn Google for India Digitisation Fund, which was unveiled earlier this week. Mr Pichai had said the cash was being funnelled to India as its digital journey was "far from complete".
Mr Ambani launched Jio in 2016 through his company Reliance, whose main businesses is in oil refining and petrochemicals.
The company, which now has 388 million subscribers, offers an attractive route into India which has one of the largest untapped digital markets in the world.