Sorry, but yes it does mean that they may give you a gift, but they'll ask for it back later. And, of course, people that used this expression were considered racist, because they insinuated that Indians did not have good moral standards or understand what it meant to give someone a gift. It probably also insinuated that they may give you a gift, but may even steal it back, since many whites were very prejudiced when this term was coined.
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