The 51-year-old replaces local incumbent Savio Medeira, who served as an interim coach for six months following the resignation of Englishman Bob Houghton last year.
"It's an honour to be here in India," Koevermans said. "I can't wait to meet up with the boys. I hope I will make a difference."
He made one international appearance as a player and was a member of the Dutch squad that won UEFA EURO 1988, but did not play a match.
Koevermans turned to coaching after his retirement in 1990 and was the high-performance director with Republic of Ireland before accepting the India job.
"We look forward to working with Wim," All-India Football Federation secretary Kushal Das said after introducing the new coach at a media conference in New Delhi. "We will support him in every way to take the team forward."