Ajay Gupta, who heads the Indian labs of Hewlett Packard, said it was a myth that Indians wanted cheap goods.

During a visit to the computer giant's UK headquarters, he urged companies hoping to boost computer use in India to offer innovative solutions and value.

Mr Gupta's comments came two weeks after chip maker Intel announced a computer specifically for the Indian market.

The Intel Community PC is built to withstand the dust and humidity of many parts of India as well as the sometimes erratic power supply that can damage standard computers.

It will runs on open-source software and has several ways of connecting to the Internet, including wireless and the mobile phone standard, GSM.

It will be manufactured in India by computer makers, Wipro, eSys and HCL and will cost from £230 ($400).

Intel hopes that the machine will help rural Indians gain a level footing with their urban counterparts and allow PCs to be used in areas where it was previously impossible.

Stumbling blocks

Large companies like Intel and Hewlett Packard see India as a potentially huge market for their products.

The country is becoming younger and more affluent. But just 5% of the population is computer literate, meaning there are nearly one billion people in the country untouched by the digital age.

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The barrier to increasing computer use is not as simple as just reducing the cost, according to Mr Gupta.

For example, there is only one PC owner for every four people with a television, he says, despite some colour sets costing much more than a low-spec computer.

"Today, a television in India costs about £200 ($350) and you can get a PC for about £150 ($263)," said Mr Gupta. "But people know what to do with a television and not with a PC."

In India's increasingly affluent society, one of the main stumbling blocks is language.

Many people are put off using computers because of the difficulty of using standard Qwerty-style keyboards with Indic languages, of which there are more than 18.

Hindi has 36 consonants that can be modified to make 1,500 separate syllables. Typing in just one may take two or three key strokes on a keyboard originally designed for the English language.

Pen gestures

Hewlett Packard is hoping to change this with a new keyboard designed to bridge the divide.

The Gesture Keyboard (GSK), developed at the company's Bangalore research laboratories, has just gone on sale in India.

It consists of a pen and a touch-sensitive pad that allows users to select from a grid of consonants and then modify them quickly with a pen stroke. The two combine to form a syllable, significantly speeding-up the process of writing in an Indic script.

"For anyone who knows how to write on paper, it takes just 15 to 20 minutes to learn the gesture keyboard," said Shekhar Borgaonkar, one of the researchers behind the device.

"For all of the Indic languages, this will be the only keyboard needed to enter data into computers," he said.

The keyboard can be used to write Hindi, Marathi and Kannada, spoken by more than 400 million people. It costs just over £30 ($53) and can be used by any machine running Windows or Linux.

If the GSK takes off it could replace standard keyboards across Asia and give people access to computing technology increasingly needed to participate in the modern world.

Green machine

So far, efforts to bridge the digital divide have largely focused on reducing the cost and complexity of computers.

Last year, an Indian company launched the Simputer, a handheld device designed specifically for the Indian market, which failed to make much of an impact.

Other offerings include the one laptop per child scheme showcased in 2005 by MIT's Nicholas Negroponte at the UN internet summit in Tunis.

The bright green laptops are powered with a wind-up crank, have very low power consumption and will let children interact with each other while learning.

Mr Negroponte plans to have millions of $100 machines in production by 2007.