Julie Sahni, author of Classic Indian Cooking (Canada, UK) and other important books, says there are no more sacred or important natural products to Indians than cow’s or buffalo’s milk. The milk is traditionally made into five products: yogurt (dahi), clarified butter (ghee), Indian cheese (chenna or paneer), thickened milk sauce (rabadi), and milk fudge (khoya). Milk is also drunk as a beverage, but it is served warm and sweetened with a bit of sugar or honey. In a nation with a preponderance of vegetarians, Sahni says, milk and milk products account for the chief source of protein.
Yes, yogurt will curdle when heated on its own. But the solution is to mix in a bit of flour, which will keep the yogurt together even when it boils. Chickpea flour is most often used for this purpose in India, partly because it adds flavor, but most any flour will do.
We have glanced at cooked yogurt recipes in quite a number of Indian cookbooks since your question came in, and few bother to tell you explicitly about adding flour. Some just put it in as part of the instructions; in other cases, the flour-step is omitted. Buffalo-milk yogurt does appear to be the yogurt of choice for Indian cooking, and as it has a higher fat content, also is more resistant to curdling. So in some cases, it appears, the cookbook authors are assuming you are also using the higher-fat yogurt. In the absence of buffalo-milk yogurt, we’d try adding a teaspoon or so of flour, cornstarch, or chickpea flour per cup of yogurt.