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Child born in India to a British citizen and an Indian parent will have both citizenships at birth.
However, any exercise of the other citizenship by the parents, such as applying for a foreign (British) passport for the child, will invalidate the Indian citizenship.
The way to retain both citizenships is to have an Indian passport and have a Certificate of Entitlement to Right of Abode stamped into it. That will allow the child to retain both citizenships.
However, as the child will have an Indian passport, he may have difficulties with travelling within the EEA and accessing things like student loans, etc. S/he will have to prove his UK citizenship by other means.