Yes!!! Today the paypal have updated in their blog that there is some technical problem with RBI, which will take at least a week to get resolved. So they now allowing the sellers and buyers of India to request a check or withdraw funds to a credit card, and these options are still available from the Withdraw Money tab of their PayPal account.
This is really a GOOD news for the online money makers of INDIA as they get the money within 7 days of money request.
Actually this problem of withdrawal was started on 27th Jan-2009. From the month of January, it is not possible for the paypal members of India to withdraw money to their bank account. This is mainly due to stringent action taken by RBI.
This was clearly explained in the paypal blog. If you want more details just peep into the PAYPAL blog. Have a prosperous day of online money making!!!