Some questions regarding Xbox Live Service
Solution 1:
You can create your X-Box account for any country, however you can only change countries once every 12 months. This can be done via the X-Box live website. You have to however copy all your downloaded content to a backup USB since you can't re-download these. Also the country on your Live account and the X-Box account must match, otherwise it will create some havoc. To access the change your region options on X-Box live look for the following on your account:
Unfortunately I am getting the following screen since I recently did this, however you will get the option to choose a country:
Gamercards can only redeemed for the country they are bought for, as they are linked to the Live store for each country.
The only reason I can imagine your games won't work bought in India, is if they are not PAL/NTSC compatible depending on what you use. South Africans for a long time bought Australian and UK X-Boxes and bought games locally and they worked fine.
Solution 2:
Be carefull, if you register your xboxlive in the usa you need to buy your gold cards in the usa. gold cards from india will not work.
luckly america is a big country so you could buy your gold cards on ebay, but be aware that me moving from Belgium to the UK means i have to travel back to belgium or let someone buy an xboxlive card in belgium.
On the same note, i need a belgian bank card to buy anything for xboxlive, i can't use a UK one since thats not my home country.
At this time it is only possible to change to certain countries, and usa, uk nor India are some of them.
I know that certain content is Region limited, however, they are checking the country you are in with ip as well, cause i know a french guy that had to use a proxy to avoid that.
Last warning about games on demand on xbox live, i am not sure how india is in official languages and so, but i downloaded CoC: WaW from xbox live, with an english description and interface, however, once downloaded, the game was in french. be carefull about it all