I am a US citizen. I will start working in Kerala (India) on an employment visa from Jan 2009 onwards. I will be filing 1040 in US showing my income from India. I would like to know if I need to pay any taxes in India. If so, need an explanation of how.

This forum addresses U.S. tax issues.

If you access a post answered by MukatA, then PM him, he can direct you to a forum that addresses Indian tax law.

Most likely, you will pay income taxes to India, then claim a combination of the Foreign Income Exclusion (Form 2555) and the Foreign Tax Credit (Form 1116) with your Form 1040.

The net effect will be that you will owe little, if any. U.S. income tax.

In India the tax year (financial year) is April 1, 2008 to March 31, 2009. You will be non-resident for FY 2008-2009, so you will declare only the India income.
You can post your India tax related questions at mytaxes - Index (http://mytaxes.in)