The Google talk blog today announced that it was introducing new transliteration bots (internet slang for software robots) that can transliterate text from English to Hindi, Kannada, Malayalam, Tamil and Telugu.Most Indians exchange emails with each other using the English script to write Indian words (for example, Namaskar for नमस्कार). Although Unicode tools like Baraha allow users to directly type in several Indic scripts, these tools are only slowly gaining mainstream use.
In the meantime, the Google transliterating bot should help popularize the use of native Indian scripts (like the one shown in the screenshot) on IM, the next most used communication medium after email.
Google has already has several translation (not transliteration) bots that are widely used for translating text between an ever increasing number of languages.
Following the link below for details on how to use the transliteration bots for yourself.
Read: New transliteration bots make it easy to chat in Indian languages