Indian citizenship

We both parent indian citizen were in USA from 1999-2004 on company work H1B visa. in 2001 one of my daughter born in USA. there was no such thing like birth registration at indian consulate and I dont remember even if it exist at that time. we applied for US passport of her due to travelling. since 2004 we are in india for good after visa expiration. my daughte has US passport and PIO (now applied for OCI card as they both merged). we are here since 2004... How can I apply for her indian citizenship. there is online procedure for PIO 7 year stay or OCI 5 year can apply. she is still 15 year old. condition is we have to surrender her US citizenship. surrendering of US citizenship happens only after she becomes 18. so can I apply for her indian citizenship. I am not sure what govt will react to this application. because if they approve they will ask for surrender of indian citizenship and I can not obtain from US consulate till she is 18. and I dont know what she will decide after 18.. is there any law because now for further studies college ask for 5 times fee and that in US dollar.. for such PIO as they hold US passport. Is there any fundametal right for such candidate for taking education based on their indian origin ...