I have this belief that lower population density and proper city planning = better quality of living,
No, most highly developed or fast developing regions, especially Europe, have a high population density. Those who don't like US, Canada, Australia, Russia and China etc. have most population concentrated in small portions of country.
Low population density has left Central Asia underdeveloped despite resources and a reasonable development head start from Soviet era. Dense population is necessary for feasibility of infrastructure and trade which multiplies wealth.
As for city planning, yes. Reasons are Indian cities were not planned for traffic unlike European lines since 18th and 19th centuries, none of Indian city got completely destroyed that had to be built from start in world wars unlike Europe. Most persistent reason is lack of money. It is just past 20 years that we have had funds to build some basic infra that we are now dreaming of having first world infrastructure.
Some western style posh cities might emerge in India by mid of this century. But country at large will continue to have sub standard infrastructure. Since country is too big, most people aren't yet mature enough for civil etiquette to maintain and time span to empty, rebuild and populate cities. India might at best touch levels of of east Europe/Malaysia/Russia etc..
so I believe no matter how much money we have we are always going to be lower than Eurozone and Muttland in terms of quality of life.
Yes and No. India will never enjoy relative gap
of living standards with world which Europe enjoys today and even might take end of this century to reach where Europe is today at crude (accounting inflation levels and ignore improvement in living standards due to just technological gains of time
Though as far as closing gap with or surpassing Europe is concerned, both India's rise and Europe's decline will contribute in thinning that gap and even surpassing Europe.
Europeans, Japanese and Americans still have to largely work even today. High paychecks for little work value are enjoyed by Aussies and Canadians; countries loaded with natural resources and no population. They live a life far better than an average American or European. And we are not going to match their living standards in this century or probably, forever.