The tablet isn't aimed at street beggers.
It's aimed at schools to try and reduce the cost of textbooks - and ultimately teachers.
But since the Indian govt is involved it will end up being a massive sink of corruption, favours to suppliers and a total lack of investment in the resources, training and infrastructure needed to actually make it useful - pretty much like any govt "computers in schools"project in any country for the last 30 years
Since you can buy no-name chinese android 2.2 tablets for <$70 retail subsidizing this to $40 isn't really such a big deal
But since the Indian govt is involved it will end up being a massive sink of corruption, favours to suppliers and a total lack of investment in the resources, training and infrastructure needed to actually make it useful - pretty much like any govt "computers in schools"project in any country for the last 30 years
Since you can buy no-name chinese android 2.2 tablets for <$70 retail subsidizing this to $40 isn't really such a big deal