This came as a surprise. Apple has lowered the price of iPhone 3Gs in India. It’s now priced at Rs. 19, 999 ($445) for the 8GB model. It was Rs. 29, 600 ($658) previously and this came out as a major reduction in the price.
According to the Apple Store guy whom I contacted, the price cut came in since iPhone 3Gs was selling in less numbers and iPhone 4 seems to be a major hit. This is a move by Apple to clear some stocks of iPhone 3Gs. This also hints that the next iPhone is in-line.