The Indian under-19 team's batting capitulated for the second time and put Australia within sniffing distance of victory in the three-day match at the WACA in Perth on Monday.
After being shot out for 165 in the first innings, the Indians fared as badly in the second essay and could score only 184 runs before collapsing.
The hosts, who had declared their first essay at 223 for seven, were 19 for no loss after the second day's play.
Nic Maddinson (13) and Tom Beaton (6) will return tomorrow to knock off the 108 runs they require to seal the match.
After their first innings debacle, much was expected from the Indians but barring Manan Sharma (81), none of the players could live up to expectations.
For Australia, left-arm spinner Luke Doran snared four for 25 from 11.5 overs.