http://centreright.in/2014/08/explaining-indian-sports-weakness-through-economics/
With as many people in India's population, I thought this nation would be a sports machine; however, I was completely wrong. It struggles to emerge as a sports powerhouse despite of the fact that very few countries can match the country's craze for sports, especially at college and high school levels. A strong showing in most sports are very rare, with the exception of cricket and hockey (when it was played on grass). It could be that Indians for averse to violent sports like American football and wrestling since they like to view them as luxury. There are a couple arguments that make sense of this.
1) In recent years, millions of dollars have been spent on new sports equipment, dietary supplements, and playing surfaces; however, the money spent has not helped India out. For their decline in hockey, it is directly correlated to the switch from grass to artificial turf and scarcity of artificial turf in India today, so the country's advancement in sports technology has not aided them to dominance.
Another strong point is that cricket receives disproportionately large share of attention, and that affects the rest of the sports monetary and non-monetary. A big, wide gap between the skill and talent of international and domestic player also exists which gets rid of some of the demand for Indian sports; therefore, the presence of the '80-20' rule is in effect. This means 80% of the attention and rewards are trapped by 20% of the sports and the rest 80% struggle to survive, and that point leads to the next argument.
2) Many people in India decide not to pursue sports too strongly as a career since sports offer incredibly short shelf lives. The rewards earned for the investment tend to come in an even shorter time-frame when the athlete is at their peak, and the biggest rewards of money and fame tend to go to the best-of-the-best athletes while most athletes struggle to stay in a sport for more than 3-4 years. There is also a element of opportunity cost. A person has to allocate a lot of time, money, and other resources and trade off with loss of free time, money, and family sacrifices.
For a prospective of a Indian sportsperson, figuring out a career path is not easy, but the uncertainty in a career a sports make it less attractive as there are many options available with greater stability, security, and durability, like engineering to medicine to law to science etc. It is cheaper to pursue other careers. There are more resources in other careers and, it is easier to become wealthy in fields that are not sports related. This could be why an average Indian would rather to go to U.S.A. on an IT/engineering/management education/assignment instead of aiming for sports scholarships.
Overall, the main reason why India is not a athletic powerhouse is because India is economically and technologically successful. As long as the United States need computer geniuses and doctors, India will not as athletes.