In a bit of an about-face, the government of India looks ready to embrace the OLPC initiative. The country had previously done a test pilot in 2007 with 20 XO laptops at a local school, but while the trials were indeed successful, it later decided to launch its own program and build a much cheaper alternative. Unsurprisingly, their so-called $10 laptop turned out to be a simple storage device that cost nearly three-times as much to make.

Now that they’ve given up on the idea, the government of India has signed an agreement with OLPC that will see 250,000 XO laptops distributed to students in 1,500 schools throughout the country. The notebooks would presumably be the updated XO-1.5, which features a Via C7-M processor rather than an AMD Geode and 1GB of RAM rather than the initial 256MB.

The purchase gives the struggling OLPC a much needed boost, one that could help recover some lost credibility as it continues to work on a more ambitious 2.0 model which is expected to land in 2010.