What should I prepare for MEXT?
My wife and I were both MEXT scholarship recipients for the graduate school "research student" scholarship. I got mine in the US by embassy recommendation. My wife got hers in Japan by university recommendation. (University recommendation within Japan is highly competitive and would be impossible without very good on the ground connections at a university that receives slots from the Monkasho).

Assuming you mean the embassy/consulate version, you need to apply to the consulate that covers your city. 

There's a written test and an interview. Depending on the numbers, they will either do everything on the same day (common in the US) or split everything across multiple days.

To successfully get a scholarship via consulate/embassy recommendation from India, you are going to need to do really well on the written test for Japanese and the test for English.

Moreover, I would recommend (against the instructions the consulate may supply) first identifying professors in Japan with whom you would be interested in pursuing a graduate degree. After you've come up with a list, e-mail them indicating you are hoping to apply for a MEXT scholarship. With this in hand, you can describe a specific project.

This is key because you need to submit a project idea as part of your application. Preferably, you should write this in Japanese and get it checked by a native speaker capable of academic writing.

With this in hand, you will also have an interview if you make it that far. I have no idea how the interview is evaluated, so I don't have any tips on that.

At the time I applied, I was already in a PhD program in the US in my 3rd year, had Japanese grammar knowledge at about the N3 level, kanji knowledge at roughly the N2 level (currently, I have the JLPT N1). I had lined up a project with a Japanese professor. I may have already met with him at that point in time.

Best of luck.