Vodafone is merging its Indian business with Idea Cellular in a deal which will give the combined group 35% of India's mobile phone customers. 

It is the latest move to win customers in a highly competitive market. 

Last year, Reliance Industries launched Jio Infocomm, the new 4G mobile broadband which offers free voice calls and cut-price data services. 

The merged Vodafone/Idea group will have 400 million customers and Idea said: "The combined entity will become the leading challenger with the scale to compete more effectively."