I understand that your employment letter/contract was drafted by your employer and the same is one sided. Nevertheless, if the company has requested you to serve 90 days notice then try to negociate and document such negociation over email that you are willing to serve 30 days notice and complete your responsibilities of handing over with this 30 day period. Also mention that you are ready to pay/buy the balance 60 day notice period. Always ensure that you have the pay/buy amount ready before you leave the organization.
As regards working in competing companies, many private companies keep such restrictive clauses thereby to restrict employees to join their competitors. The Indan law per se does not bar any person to work for competitor companies. Also, the constitution of India provides every citizen of India a right to employment anywhere in India, hence such a fundamental right cannot be curbed by a private company through agreements. In the past the Courts in Inda has heard similar cases where the Court has opined that the private companies cannot restrict an employee to his right to employment.
I would recommed that you should refrain from giving such declaration that "you will not be working with competitors".
You should draft your correspondence/letters between you and the company very carefully as they might be used in the Court of law as evidence, against you in future.
2nd June 2011 From India , Delhi