Swaddies is an English term - dating back to, at least the 18th Century - rather than Indian (although I can't back that up as I can't get to the OED, the company Library having closed) however, I'll try to search out an etymology when I get home (or on Tuesday, when I can get back into the library). Squaddie only dates from about the 1920s and derives in part from "swaddie" and part "squad", a formed body of men (as in drill squad, awkward squad etc.).

Regards

Walrus