Avi, the problem is clearly grave.
As you rightly point out, proxies such as funding and the subsequent hiring are often celebrated by the mainstream (and newstream media alike) as the sign of success, and multiple pages are devoted to those stories and the larger-than-life caricature of rockstar founders, thereby influencing the mass media that this is it!
Our army of coders is simply not equipped with the product mindset having been long given a PRD / BRD / SRS / FRS / Product Backlog from the customers and asked to simply deliver the features. Most of our engineers are simply spending far too much time talking to computers rather than talking to people and “discovering” what might be potential pain points.
The mid-career (in Indian, you’d have to call them “senior”. which is yet another bane of the industry — the morbid obsession with titles and hierarchy) professionals are often too caught in the MS Office products (a polite reference to those whose days are spent in mail, reports, spreadsheets and powerpoints, or basically doing nothing meaningful during the day!). Every week after week, I see more and more of such professionals who are simply whiling away their time but neither changing the status quo in their environment nor for themselves, for the lure of a steady paycheck and the power status of a manager make up for a heady cocktail that is literally impossible for most to give up!
The result is the instead of an army of lions led by a lion, or even an army of sheep led by a lion (Given the circumstances, I would still settle for this!), we have become an army of sheep led by sheeps :(…herds that are busy churning out me-too ideas at India-scale. In a way, we are playing back the script of India in 50s through 80s — the manufacturing world simply copied ideas from the west — e.g., car designs (remember the Ambassador and the Premier Padmini), scooter designs (Bajaj), etc., etc. We might call ourselves as the modern-generation IT industry and what not…but in reality, we are simply copying the copy-and-paste model that our manufacturing elders have shown us. Come to think of it…even our copying formula has been copied :(