India has banned imports of mobile phones which do not have a unique international identification code.
Cheap mobile handsets without the code and imported primarily from China and Taiwan are popular in India.
Over 25 million such handsets are now in use in India, according to the federal telecom ministry.
Last year, Indian intelligence agencies had said phones without the code were being used by terrorist groups in attacks in the country.
Time-consuming
The International Mobile Equipment Identity (IMEI) number is a 15-digit code which appears on the operator's network whenever a call is made.
The absence of this number makes it impossible to trace either the caller or the phone. It is also makes it impossible to get call details for these handsets.
Orders to detect handsets without the identification numbers were issued last year but some mobile phone operators asked for more time to identify these phones.
They said the time and software required to identify these phones was time-consuming.
Priced between $60 and $120, the cheap handsets have a big market among rural and semi-urban consumers who want connectivity at cheaper cost.
There are over 380 million mobile phone users in India.
The president of the Indian Cellular Association, Pankaj Mohandroo, has been campaigning against Chinese-made phones for years.
He called the government announcement as a "partial solution" saying the problem of millions of handsets in circulation has not been tackled.
"We have demanded immediate disconnection of services to such mobile phones but that has not happened," he observed.
The government has ordered that no new connections be provided to such handsets.
India has also announced a partial ban on the import of Chinese toys that do not meet international standards until January 2010.
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