The project, titled From President to Prisoner, is based on a book by Aziz Burney, reports Mumbai Mirror.
Actor Akbar Khan, who plays the former Iraqi leader, revealed to the tabloid: "I consider him a hero who stood up and fought against the double standards of US foreign policy.
"The US used him as a tool. It's a great pleasure to be in his shoes, even if it is a film."
The documentary drama will reportedly focus on the final years of Hussein's life in Iraq.
"I am ready to go through the grind for the character and it will be my challenge to depict Saddam Hussein as naturally as possible," added the actor.
Filmmaker Kohli insisted that Khan is the ideal figure to perform in the role of Hussein, saying: "When the idea popped, I kept Akbar Khan's photo next to Saddam's and everyone agreed that he would be the best pick for the role, and Akbar agreed too."
A planned Hindi film production about Adolf Hitler, starring veteran actor Anupam Kher, was scrapped last year after receiving widespread condemnation.