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I've bought for my Italian site a domain (for example): www.FOO.in .
The extension .IN is (in theory) for Indian web sites. I haven't bought .IT (italian web site) because it was already occupied. The same for other famous extension: .COM, .NET, .ORG etc.
So when I search for the word "FOO" in Google Italy will be there possibilities to appears on top (the first 10/20) pages?
From your experience, how does Google handle "keyword" in domain name, but with foreign extension?
No, it will be much harder to rank it in Google.IT
Try getting a .it domain that has the keyword. So if your keyword is "tickets", try mytickets.it or ticketplace.it etc.
Overall, you will need backlinks from Italian sites.
Google gives a bias towards search terms in the domain name but is more biased towards .com and to a lesser extent, .net and .org. Unfortunately I'm not sure much will be gained by .in
I would focus my efforts on other aspects of Search Engine Optimization (SEO).
See this article for some SEO basics: Everything you already know about SEO
Google does have "geographic targeting" for domains. Presumably that means it will favor certain domains over others depending on your geographic targeting and where the person searching is located.
For the generic TLDs (.com, .org, .net, etc) you can set the geographic targeting to any country you want in Google Webmaster tools. For country-specific TLDs, the geographic targeting is preset to the appropriate country and cannot be changed.
So, your .in website will probably get a bit of a boost in India, but not in Italy. As for whether it will be penalized for Italian searchers, I would guess it might a bit, but that's purely speculation.
