Can this be counted as a research experience for Grad school? I've recently completed my bachelors in Mechanical Engineering from India. In my last year, I worked on two four-month projects in two leading research institutes affiliated to the government of India. Both projects needed tons of literature survey and calculations. However, I didn't make any prototype. Everything from design and analysis was on software. My supervisors found everything satisfactory. I was also responsible for designing certain things not related to my project too. I am confused if everything above mentioned counts as a 'research experience' for applying to Grad school and emailing to professors seeking students to apply for MASc. positions.
Sure it counts as research experience! 

"Research experience" is different than asking for a completed research project or a publication. It just means you have some experience with some aspect(s) of the research process.

When speaking/writing about the experience, just be clear and honest about what parts you were involved with, and show your understanding of how what you did fit into the overall picture of the project(s) you participated in. The general format is roughly: "I worked on a project to improve multiple crop yields using modern furniture design. After reviewing the literature in the area of agricultural design and art deco stylization of farm equipment, I designed and analyzed the effectiveness of apple hammocks on crop yield, which led to blah blah blah. I also assisted with other projects, designing pineapple cradles, a hollow wine cork, and system for drying finger towels more efficiently." 

The people evaluating your application want to know what you did and what parts of the research process you have experience with, so don't worry if your experience wasn't completely end-to-end from concept to publication, that's the norm.