I don't see a problem setting it in India, even a fictionalised version, any more than I have a problem with Hollywood's rather ludicrous view of the UK. As it happens, I actually think the film did a semi-decent job of showing the development of India in the years it covers, and one or two people I know who live in Mumbai (Indians, not English people living abroad) agreed on that.

It is true that some people have become a lot more sensitive about this sort of thing, about who has the right to tell what story, and how. But ultimately, I ask one question: Do I like the story? In this case, I do.