I think they can still be saved if they can't read but it definitely makes communicating the gospel more difficult. In Philippines around low-literacy areas we used the Jesus Film which was very helpful.
http://usa.ntm.org/mission-news/79627/literacy-is-an-essential
REACHING the WORLD with the GOOD NEWS, the GOSPEL of JESUS CHRIST
Sunday, June 8, 2014
CAN'T BE SAVED if they CAN'T READ? "Literacy is an Essential" - Christian Mission News - New Tribes Mission USA
