Xbox – Price reductions on Xbox Live Arcade games

You will have to create a new, American Live account. Create an American account with Hotmail or Live. I say create new because you won't be able to change your country if you already have a UK Hotmail account. I had the same issue, so I created a new account with "Location: US", used my credit card, and it worked. Any major credit card should work when purchasing points. If you can't use your credit card, you can always buy a points card from Amazon (or elsewhere) and redeem the card's code on your account.

The drawback here is that all the stuff you in your previous account needs to be re-bought and there is no way to transfer that ownership. However, the XBLA and other downloaded games should be accessible from the new account if you are using the same Xbox 360.

You can create your X-Box account for any country, however you can only change countries once every 12 months. This can be done via the X-Box live website. You have to however copy all your downloaded content to a backup USB since you can't re-download these. Also the country on your Live account and the X-Box account must match, otherwise it will create some havoc. To access the change your region options on X-Box live look for the following on your account:

Unfortunately I am getting the following screen since I recently did this, however you will get the option to choose a country:

Gamercards can only redeemed for the country they are bought for, as they are linked to the Live store for each country.

The only reason I can imagine your games won't work bought in India, is if they are not PAL/NTSC compatible depending on what you use. South Africans for a long time bought Australian and UK X-Boxes and bought games locally and they worked fine.