BANGALORE, INDIA: Sale of mobile handsets in India, the world's fastest growing wireless market, should rise by 18.5 percent this year on increasing telecoms penetration in Asia's third-largest economy, research firm Gartner said on Thursday.

Mobile handset sales will rise to 138.6 million units in 2010 and 206 million by 2014, up from 117 million last year, it said.

India is the second-largest wireless market in the world after China with its 636 million mobile subscribers at end-June, according to data from the country's telecoms regulator. Mobile connections were at 525 million at end-2009.

Gartner said the Indian mobile handset market, which was dominated by a handful of manufacturers such as Nokia Oyj and Motorola previously, is been facing intense competition due to entry of several local companies.

"Established global device manufacturers are losing ground due to fierce competition from local and Chinese manufacturers in the low-cost segment," said Anshul Gupta, principal research analyst at Gartner in a statement.

"Price remains the main criteria when buying any consumer electronic device in India, including a mobile device."

The average selling price of a mobile handset in India is about $52, with 85 percent of devices sold costing below $100, the research firm said.