It depends, when it is loseley woven it is easy to felt on merino and it gives great results especially when it has beads or sequins. I have not used it for myself but on a fair I saw a lady selling indian lace with lovely pieces of wetfelted indian lace, so we talked a lot about it. The lace sinks into the merino and gives you a beautiful pattern of color and glitter. It does not matter if it is real silk or synthetic. The synthetic takes some more time but gives you more structure because it is stiffer than silk.
My Indian lace arrived today, it is lovely! It measures 12" x 14" and the colours are turquoise, rusts, creams with a few sequins. It is cut from a roll, so it is not the normal width you would associate with lace. It feels like tulle. I have stretched it out and sellotaped it for you to see, it is very crinkly. I hope I can do it justice! Please excuse the photo on the carpet, I tried everywhere in bad light and the carpet showed the colours the best. www.dropbox.com/s/cwkaw1g9zh5ah4o/20170118_140505.jpg?dl=0