You have to understand something - you cannot ask someone to sacrifice his or her potential for "nationalism" - very few will want to do that. In spite of what YOU or others may claim here, each of us want to maximize our own happiness and standard of living. Most of us also try NOT to do bad (illegal, unethical etc) things to achieve that end, NOT because we really care about being "good", but because we know that bad things bring penalties and increase the risks for ourselves and our loved ones. In effect, each of us live by the principle of "do no evil, live and let live". Along the way, if we do good, we feel proud and good about it. But most of us (99.99%) DO NOT set out to do good for the masses. If you expect people to behave in any other way, then you are not being realistic.
For all your claims of "choosing" not to work for a foreign company (i.e. being primarily traded on a foreign stock exchange), try to figure out who you really work for and who owns what share in your company and what they do. Just being Indian company does not mean much for India. There are "foreign" companies in India who pay shitload of taxes and employ thousands of Indians and bring in forex to the country. There are also lots of "Indian" companies who evade taxes, cheat the system and do lots of evil.
As for the "dollars" that your company gets paid, remember, if they do not invest them in the Indian economy, then they are of not much use there, is it?
As for IITians, I hope they go wherever they can perform to the best of their abilities and get the most happiness and in the end, do most good. Being stuck to the apron-strings of "Mother India" and being kicked around by the corrupt politicians and bureaucrats of state and central governments is not the solution.
As for the GoI subsidizing higher education, I think that should stop (except for research grants) and that money should be spent in primary, secondary school and high school education (and in that order). build better schools, bring in computers to the public schools and hire teachers with better salaries. Leave higher education to bank-loans and scholarships (to be earned).