The network will launch with a host of exclusive local content, such as downloadable Bollywood films and trailers. As in other countries, gamers will be able to choose between Silver and Gold membership.
In addition, Microsoft is to launch a games rental service in partnership with local firm Seventymm.
"We have just celebrated the first anniversary of Xbox 360 in the country this year and it is with a celebratory spirit that we offer our Indian consumers even more entertainment options on Xbox 360,” Microsoft’s Entertainment and Devices Division global president Robbie Bach stated.
"This is not only a firm reiteration of our commitment to the Indian market, but also an exciting foray into connecting our Indian consumers to a world of seven million Xbox Live members around the world."