we heard that hotels used to have sign boards such as these during the british raj!!!
Lastly, it is not just about boycotting the restaurant. That may or may not work.
What is more important is taking pride in being an "Indian". Nobody can make us feel "inferior" in our own country. We are a growing world super power (despite the colour of our skin) which the entire world is recognising slowly. When our PM Modi ji speaks the whole world listens with attention - which makes our hearts swell with pride - But if some establishments within our own country feel otherwise and want to puncture our pride - it is a sad state and the Government may also like to step in to ensure that such things do not happen.