As Spud says, an international drivers licence should get you through any police checks. You're unlikely to have a problem in India as many drivers here don't have licences and you should be able to bluff your way passed any police that might stop you.
We were stopped a few times in Bangkok, but only because we accidentally got on to the expressway which is for cars only. They asked for paperwork, but were mainly interested in seeing the temporary import certificates for the bikes.
Have you been to India before? The traffic here is probably the worst in the world and riding a bike is pretty scarey to say the least. Even on two big beemers, we regularly had to leave the road for oncoming buses and lorries - two wheelers are well down the pecking order on India's roads. You don't say how much on road experience your wife has and, assuming her experience is limited, it would be a good idea for her to get some miles under her belt before coming here - this is not a good place to learn your roadcraft. Please take that advice as intended, I don't wish to be patronising.
If you come over within the next 12 months, give us a shout - you're welcome to stop over with us (we're in southern Delhi, about 20 minutes from the airport).
[This message has been edited by harvey (edited 13 November 2003).]