Yes, since this income is earned in India, tax will be payable by the NRI in India. In fact, tax will be deducted at source by the payer of the rent, a.k.a tenant. The tenant must obtain a TAN number and deduct TDS of 30 per cent from the rent amount. He must also provide a TDS certificate to the NRI.
The duty of deducting tax is on the payer. So in case the payer does not deduct tax and the NRI too fails to declare the income and pay the tax, the income tax authorities can hold the payer responsible.
Having said that, if the tenant does not deduct tax at source, it is obligatory for the NRI to file tax returns and pay the taxes thereof.