Per the obvious, the Rakasha have their origin in Hindu mythology, though there they are called the Raksha and are wicked spirits that do battle with the gods and make life more-or-less miserable for the people they come across.
In Lord of Light, though, the Rakasha aren't really demons at all. They are life forms native to the planet who:
"[…] found a way to perpetuate themselves as stable fields of energy. They abandoned their bodies to live forever as vortices of force. But pure intellect they are not. They carried with them their complete ego, and born of matter they do ever lust after the flesh." (1.272)
This evolutionary tract provides the Rakasha all the powers of a fantastical demon but keeps them in the realm of completely natural beings. In other words, Zelazny found a way to bake his mythology cake and still eat it with a science fiction fork.
Oh, and if you're curious, mythology cake is a layered spice cake with a gooey cream cheese frosting. Now you know.
Not surprising at all, Taraka (big cheese of the Rakasha) gets his name from a super powerful demon in Hindu mythology. The demon became so powerful that even the gods feared him, and Shiva had to craft the hero Karttikeya, just to battle Taraka. Since the world is currently not subject to demon spawn, we can safely assume Karttikeya won (source).