While the above is true it doesn't apply to this domain name. I know why that is because I recently got the .co.in version of it and it gets more traffic than .in, this is because Indians are more versed with .co.in because of google, yahoo and msn on .co.in domain from the beginning.
It is irrelevant that state owned companies distribute directories or not. These are just direct navigation domains if there is a website on these names it will be a good one, if not they always make money because of the natural type ins and the no of visits is going to increase and never going to decrease.
When it comes to value they might never equal their .com version but $500 is less for sure. it deserves a grand at least even today because of its very generic nature.
All the above is based on my own personal experience with my .in portfolio, back in 2005 traffic is null now steadily increasing. I know some of it 10% at least is from domainers looking to register these names. I see good future for .in.
I am a very low key domain speculator who doesn't sell, talk or show my domains usually other than buying them, I got excited this time