If I can be frank...what do you think of the work culture in India, and would you really recommend it to a foreigner? I've heard that people are frequently dishonest and unreliable, that agreements are often not honored, etc. (And I've heard this from Indian friends.)
If you're caucasian, yeah - there will be a few people who will try to take some kind of advantage of your naivety. If you're a little careful and take some time getting used to it, you should be fine.
OP was asking for relatively cheaper, still plausible cities to start up in (he/she mentioned Chinese cities), so I just pitched it as a viable alternative.
I wouldn't recommend it straight out, as the last thing you'd need to worry about while working on your startup is to fit in with the local culture. Still - if you stay indoors you should be fine.
Spend a lot of time during the interviews. That's the surest way to get rid of these kind of people. If you depend on your HR to hire for you then you WILL end up with an unreliable and mediocre bunch of people. (My company has a HR team but I never ask them to find me candidates. I do all activities including resume filtering and pre-screening. As a result I have a much better group of people.)
I am very curious about this, too. Realistically, I might have to go to India if I want to keep coding.
The Indians/Bengalis I know locally are really nice people (if a bit square :-). On the other hand, I've heard in third hand that people moving to work in India said it was no fun at all.
