The Google Summer of Code (GSoC) program offers $5000 for a 4 month project you do for one of the participating open source projects. You get a mentor, hands on experience of implementing something which will potentially be used by real users and also get to be a part of an ever growing community of hackers in India.
Now let us say, you were able to get into the program. So you have access to:
At today's conversion rate, $5000 translates to Rs.2,22,000/- approximately. After paying taxes (which comes at max to about Rs.6500/- assuming male and no other income), you are left with 2,15,000 in your hands. For a college student, 4 months expenses can be as low as Rs.10,000 when living on campus. But let us keep it at Rs.25,000/- assuming you really decided to live it up. Still there are ~Rs.1,90,000 in your account.
Excellent Pool of Co-founders
If you are on any of the mailing lists like OCC, HeadStart or follow the forums like Pluggd.in, NASSCOM Emerge, you can find any number of would-be-entrepreneurs looking for co-founders, especially technical co-founders. Through the GSoC community, you know a fine set of technical geeks who are willing to spend their summers working on arcane parts of free software projects. Guess what! These are the guys everyone is looking for but is unable to find. Grab one of them and find something of mutual interest. Bonus: your seed fund just doubled. If you want to be extra secure, just find one more co-founder. :)
Experience of actually building something
Assuming you participated in GSoC out of love of hacking and not for money, you already have more experience at building real things than most of the graduating students and most of the alumni of past 2-3 years.
Initiative & Timing
There will not be a better time. Do GSoC in the final year of your college and then use the money to work on your dream startup immediately afterward. You will be in the flow and free of other burdens and worries. If it doesn't work out after 1 year, just think that you took 1 year extra to complete your degree ;-). With the skill set you develop, you will find a good job any given day.
So don't let this golden opportunity pass you by. If only GSoC had existed while I was in college!