Though there are two phones here which have smaller screens, these devices offer really good value for money that couldn't be ignored.
Nokia Asha 311
The phone is one of the best in Nokia's Asha series. While Asha 303 at around Rs 7,600 was definitely overpriced, Asha 311 for Rs 6,500 offers great value as you get a phone with a 3 inch capacitive screen, a 1 GHz processor, a refreshed UI, a brilliant maps application, GPS, 3G, and WiFi connectivity. Also worth mentioning is the scratch resistant Gorilla glass which I believe no other company offers in this price range.
Plus, there are 40 free games from Electronic Arts. Nokia Ovi too has all the apps you will ever need (FB, Twitter, Angry Birds, Whatsapp etc). All this comes with great build quality and after sale service from Nokia.
The S40 operating system, being light, works effortlessly on a powerful 1 GHz processor, and the OS is also very simple so it is a good one for first time smartphone users.
While some would argue that this is not a smartphone as it does not support multitasking, the reality is that most entry level Android phones do not support real multitasking either and, moreover, Asha 311 can multitask for basic functions like music, FM etc.
You can also read our comparison of Asha 311 with Samsung Galaxy Y here to get a better idea of what we are talking about. You will also see why Samsung Galaxy Y is not in the list despite being a popular phone from Samsung.