Linux is a natural for India
India has a huge pool of software and scientific talent. A lot of the engineers and doctors have moved to green pastures -- the West -- but yet talent levels are reasonably high. These people are also power users themselves, and a lot of them enjoy using and encouraging the use of Linux. Every large organization will definitely have one Linux guru or an enthusiast in it and this helps. This one person will generally drive the management towards deploying Linux. Linux expertise is not as easily available as your neighborhood Windows expert, but it\\\\\\\\\\\\\\\'s picking up.
In the land of Mahatma Gandhi, freedom comes naturally. Even though free in India is more important than Free (note the capitalization), India is a democracy and people understand and appreciate their freedoms. Also, some Indian companies have burnt their fingers when developers have taken them to ransom by holding back source code and demanding huge sums of money. These companies appreciate software freedom and are willing to contribute to it.
These are some of the reasons why Linux is favorable to India. There are also a few reasons why Linux is not so favorable
Windows is the defacto standard for desktops. Most PCs and laptops ship with Windows, and people think that everyone uses Windows so I should also be using Windows. All the PC vendors and white box manufacturers are very comfortable supporting Windows.
Piracy is rampant, and Windows/MS Office is the top on the list. Here the cost comparison doesn\\\\\\\\\\\\\\\'t help Linux because a pirated copy of Windows is considered free. Thankfully, Microsoft is getting after people and conducting raids so people are getting concerned about piracy. Because all of them can\\\\\\\\\\\\\\\'t afford Windows, they are now at least considering Linux.
Windows applications are there in plenty, especially custom-developed applications. Most people have no love for the Windows operating system, but the application situation is what holds them back from changing to Linux.
Windows programmers, and thus applications, are easily available. Any person with some knowledge can write a simple business application using VB and Access. This results in more and more Windows applications.
In spite of these limitations, Linux is still picking up, and there is a lot of Linux interest and enthusiasm among the people. Corporate managers, especially the CFOs, are seeing Linux\\\\\\\\\\\\\\\'s cost benefits and are adopting Linux in their companies. The government, too, is getting supportive and is trying to emulate what other countries are doing with Linux.