I have a theory regarding the issues in the current military.
Most of the officers who graduated when India was under British rule were the ones who had shown exemplary skill and conduct. Post 80s, most of these guys had retired already, and the new officers who were raised under the socialist economy took office, which where I think the decline started to happen.
Now with economic liberalization, I think that when the officers from the 2000s and 2010s start to take high offices, there will again be a shift in the way that the military works - these guys have been raised completely different from how the older officers were.
Just a theory - I don't know how valid this is, but it made sense to me.