I was checking in the user tool (7.5.00), there is time zone (GMT +5:30) Bombay, Calcutta, Madras, New Delhi in Time Zone form.
Isn't this the same timezone which you are referring to?
I am using User Tool 7.0.01 Patch 003. Newer version may that timezone but not the higher version. If you have any idea on how to update the timezone list in the lower version please let me know. It wil be helpful.
Look into the AR System Configuration Guide. There is a seperate chapter dedicated to business time / time zone.