maddening crowds, useless research et al, is this is what we have come to be?

There has been a lot on my mind since yesterday, thought i should share it with you guys. Firstly the thing that has hounded me since i have started my engineering ugrad.
100000 engineers annually, over 3000 MBA colleges, 7 premier IIT's and a host of other research institutions, plus state universities to boot and to add to it all- a huge and perhaps the most brightest collection of youth resources in the world, these figures should be enough put any country on the world map as a powerhouse sooner or later, you would think but alas... .
You won't get admission to the IIM's for guessing which country i am talking about, it is my, in fact our beloved India. Lets counter those figures 100000 engineers but only 10% emploable and even fewer who can be counted as true technical flagbearers of the nation, further the amount of people pursuing hopeless degrees for puposes best defined to them is increasing faster than ants on a lump of sugar(poor analogy, don't mind it, but i hope you got the drift). Research that can be put to real use constitutes only a small fraction of the total amount of research being done.
I am not going to point fingers at anybody but i want reasons and those reasons have to come from you guys and this is not the last you will hear from me on this topic........