Cheque withdrawal of funds remains the only option left for Indian citizens
Please note that there will be a change in paypal withdrawal functionality in India starting August 1, 2010.
At present, India users may continue to request for both an electronic and cheque withdrawal of funds from their PayPal account in India.
From July 29, 2010 onwards, India users will only be able to request for a cheque withdrawal of funds. To help our users with this change, PayPal will refund the $5 USD cheque withdrawal fee for cheque requests made on July 29, 2010 onwards.
Please let me know what you think of this new change in Paypal.