There are a number of good explanations for why downloading is popular. First, not everyone lives near an Indo-Pak grocery/music store, and a lot of Desi stores aren’t very serious about getting current music, or a broad range of it. Second, so much of the music is kind of crappy and derivative to begin with (Hindi film producers often borrow bass-lines and samples from western or Arabic pop songs), so why worry about making sure the artist is adequately paid for his or her work?
I have always thought that an online music store with Rahman's work would do very well. He is certainly the best music composer of his generation and he has sold over a 100 million records so far. A track by him is definitely worth a $1.
The real problem would be to get all or most of his music in one place since numerous companies own his huge body of work.