Google Docs in Google Apps now supports all popular local languages of India including Hindi, Tamil, Telugu, Gujarati, Kannada, Malayalam, Bengali, Marathi and Oriya.
To switch the interface from English to an Indian language, go to settings and choose your desired language from the drop down.
Other than creating documents, spreadsheets and presentations, Google Docs also has an in-built spell checker for each of the localized Indian languages. via
Related: Google Indic Transliteration