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I have engaged in this discussion more times than I care to remember - by most estimates at least thrice a week for the past seven years. So this is a topic close to heart but also very well debated and honed. A look at the Dutch disease and the fallacy of composition can help us understand why India needs her cricket team to fail spectacularly, and regularly, for Indian sport to truly flourish.
The cricket world cup is less than two months away and it could turn out to be one of the most important sporting events of this decade - even bigger than the triumph in the previous edition in 2011. But only if India fails. A victory, even though it will be much celebrated, will see (even) more money being poured into the sport and (even) more kids seeing cricket as the only viable professional sport option in this country. The popularity of the game itself has never been the chief concern - till it has reached the current scale. This popularity has led to investment, talent and a country's sporting vision being squandered on a game which holds limited appeal to most of the world, doesn't earn a single Olympic, Commonwealth or Asian games medal, a game which doesn't foster a "sporting culture", a game which doesn't require its players to be athletic or fit, and most importantly a sport which has grown so big that it dwarfs all others, much to the detriment of every other sport.
The Dutch disease is a curious economic phenomenon. A mineral rich country sees its manufacturing sector battered, because all the exported minerals make the country's currency stronger (because of higher demand for the country's currency), thereby facilitating cheaper imports (as the relative cost of local manufacturing has gone up). Adam Smith's invisible hand is at play here. What this also does is shrink investment in the manufacturing sector and sees more money being poured into the commodity unearthed and its ancillary industries - setting up transportation, refining/processing and marketing activities around that commodity.
The parallel with Indian cricket is there for all to see. Without even discussing the most brazen brainchild of the governing body of Indian cricket, the Board of Control for Cricket in India (BCCI), the Indian Premier League which has sucked in large amounts of investment, the realization that a sporting Dutch disease has afflicted India is quite clear. Take the BCCI Corporate Trophy for example. This is an almost unheard of league, but serves as a traditional curtain raiser for the Indian season. The aim is to involve promising local players, discared players from an erstwhile rebel league (the ICL) and a few star players in order to showcase the "employability" of cricketers to corporates. The winning team bags INR10million. The runner up nets INR5million. That is 15 million rupees that have just been "awarded" to showcase "employability". A gargantuan waste of money in a country where the total amount of investable funds for sport doesn't grow much year on year. To help you put the plight of the nations "other sports" in perspective, the national football team earned INR28mn in sponsorship in 2013 - and sponsorship, along with broadcasting rights are two of the largest streams of income in sport.
A provincial cricket league which dwarfs all of Indian football