Why Columbus called them "Indians"

The majority of the following is from The Encyclopedia Britannica (1996 Edition)

Why did Christopher Columbus call the people inhabiting the Carribean Islads "Indians", when there was no such country or territory named "India" at the time?

Christopher Columbus coined the term "Indian" when he landed on a small island in the Carribean.
    - Fun Fact, Columbus never stepped foot on the land mass known presently as the continent "North America".

The past 500 years have seen a myriad of terms used as referents to the people living on the Carribean Islands that Columbus invaded and enslaved, and later to all peoples of the Western Hemisphere. 
- Indian
- American Indian
- indigenous American
- Native American
- aboriginal American,
- First Nation
- Amerindian
- Eskimo
- Inuit, and 
- Native Alaskan. 

Some of these terms are used almost interchangeably, while others indicate relatively specific entities.

The term American Indian is often used to refer to the indigenous cultures of the Western Hemisphere in general; its constituent parts were in use from at least the early 16th century. The word Indian came to be used because Christopher Columbus repeatedly expressed the mistaken belief that he had reached the shores of South Asia. 
    Convinced he was correct, Columbus fostered the use of the term Indios (originally, “person from the Indus valley”) to refer to the peoples of the so-called New World. 
    The term America came into use as a referent to the continents of the Western Hemisphere as early as 1507, when the German cartographer Martin Waldseemüller published a map naming them after the Italian explorer Amerigo Vespucci. The word American was soon thereafter appended to Indian to differentiate the indigenous peoples of these regions from those of South Asia.

     In the 1960s many activists in the United States and Canada rejected the phrase American Indian because it was seen as a misnomer and sometimes carried racist connotations. In these countries Native American soon became the preferred term of reference, although many (and perhaps most) indigenous individuals living north of the Rio Grande continued to refer to themselves as Indians.

    Europeans initially called the peoples of the American Arctic Eskimo, a term meaning “eaters of raw flesh” in the languages of the neighbouring Abenaki and Ojibwa nations. Finding that referent inappropriate, American Arctic peoples initiated the use of their self-names during the 1960s.
   Those of southern and western Alaska became known as the Yupik, while those of northern and eastern Alaska and all of Canada became known as the Inuit. 
    The 1960s were also a period during which Alaska’s aboriginal peoples initiated a variety of land claims. As an expression of unity, these diverse societies, which included not only the Yupik and Inuit but also nations such as the Aleut, Gwich’in, Deg Xinag, and Tanaina, adopted the umbrella term Native Alaskan.

    In the 1970s, Native Americans in Canada began to use the term First Nation as their preferred self-referent. The Canadian government adopted this use but did not furnish a legal definition for it.
     The Métis and Inuit preferred not to be called First Nations, and thus the terms “aboriginal peoples” or “aboriginal nations” are typically used when referring to the Inuit, Métis, and First Nations peoples of Canada in aggregate.

    By the end of the 20th century, native peoples from around the world began to use tribal self-names when possible (i.e., to refer to an individual as a Hopi, Xavante, or Sami) and the word indigenous when a descriptor for their shared political identity was more suitable.
     This preference was recognized by the United Nations when it established the Permanent Forum on Indigenous Issues (2000).
    The UN then passed The Declaration of the Rights of Indigenous Peoples (2007).
    In the United States, however, many individuals of indigenous heritage continued to refer to aboriginal Americans, in aggregate, as Indians.
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