I would like to add 2 more things.
I tried directly launching the app from the code without using the API and it worked. I also added the code for checking if my device is a Nokia device.
The above code works. After going through the source code of the API on github, this seems to be the same thing that the API does. Therefore, I don't think it has to do anything with my phone having the Indian version of the Nokia Music app as I doubted in my previous post.
if (string.Equals(DeviceStatus.DeviceManufacturer, "NOKIA", StringComparison.OrdinalIgnoreCase))
Uri launchNokiaMusicString = new Uri(nokia-music://);
The second thing is, I did not mention earlier that my app was upgraded to target wp8.0 instead of wp7.5. I am beginning to suspect that this is the reason that my app is not able to use the API properly.
I will investigate the source code and update this thread with my findings.