My first hypothesis: cremation. High cremation rates mean few cemeteries and few fears of zombies. But Japan has even higher cremation rates and does have a few zombie movies.
My second hypothesis: religious politics in India. Islam forbids cremation, or at least that's what's suggested by a quick web search. So the potential pool of Indian zombies is going to be heavily Muslim. If there are already reasonable religious tensions between the two groups, a zombie Bollywood movie where presumably Hindu heroes would go around being menaced by, and killing, predominantly Muslim zombies might not be the best idea.
But that hypothesis fails too. Somehow India has managed to produce the local public good of not making a zombie movie? Yeah right. It might explain why a big studio with political connections wouldn't have put out a zombie movie, but it doesn't explain why one doesn't get financed by some Hindu nationalist organization. In fact, we might expect a low budget zombie movie then to be more rather than less likely.
I hope it's nothing as ploddingly dull as different local mythologies meaning different superstitions and a non-universalisation of the Frankenstein fear. But be careful::
Western horror films happily mine religious imagery in the knowledge that the audience will be largely secular; in India and Pakistan it would be dangerous to make such an assumption, and so film-makers are prone to borrow western myths rather than explore their own.My read of the linked article is that successful Indian horror movies have been those that have played with those Western horror myths that are consonant with Indian myths: ghost and vampire stories.
Horror films as a genre seem very thin market in India. A Bollywood-style zombie movie would then be very thin market indeed. If it's tough to do a low budget Bollywood film - Baumol's cost disease on the troupes of singers and dancers - then those films will target mainstream Indian cinema, not niche products. And a Bollywood zombie movie would be a niche of a niche: you kinda need the mainstreamish version of zombie movies before you can do the Shawn of the Dead treatment. My ideal Bollywood zombie movie would be genuinely terrifying, with dance intervals to relieve tension rather than as comic relief, but the Shawn of the Dead version would be much easier to pull off.
So it's again the curse of high fixed costs mixed with idiosyncratic preferences. If there were a few million Erics around, we could have Bollywood zombie film festivals on Seasteads. But there would be other problems.