In form 1040 NR the standard decution for US India treaty of 5150$ has to be filled up in item 37 i.e. itemized deduction?

Yes, that is where it goes. Write on the left of the #37: "Standard Deduction permitted under U.S.-India Tax Treaty".

BTW, you can claim this ONLY IF you are a F-1 visa holder or a special type of J-1 visa holder.

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