Getting back to the matter in hand, my recent experiences suggest that Blogging is particularly suited to local languages and cultures in India. It seems to me that it is unlikely that there is going to be massive demand for this name, when most of the sites will be in Hindi, Marathi, Urdu, Bangla, Punjabi, Telugu, Kannada and Tamil. I think your target market is going of a size probably comparable to say Greece rather the 1 Billion you have quoted. Dot co.in probably does get more traffic at the moment, but dot IN is the future and that will be boosted enourmously by the introduction of IDN.
It would seem that the $400K was a very generous settlement for the dot com.
I would guess that this domain will have some value at it could well be used by an IT elite or the expatriate community, but I would say low $x,xxx.
Best Regards
Dave Wrixon