I think most of my colleagues agree with me on this that the students have NOT become more "intelligent" in the past 10 years. In fact, it is the opposite. I attribute it to the following reasons:
- The removal of subjective exam from JEE: I think that this is the biggest mistake by MHRD, even a bigger mistake than opening new IITs. Students are just learning "tricks" to clear objective exams and many of them are not adept at writing even one technical sentence properly in either English or their mother tongue.
- Advertisement of salaries in the newspapers: When I entered IIT Delhi, I did not know what kind of salaries IIT students got, nor did I care and I can say that safely about many of my friends. We never talked about salaries. But, the situation is very different today because of salaries being promoted in the media. It is a really bad culture. IITs don't understand it. It is bad for the students to know these things, because it attracts the students who are not really interested in studies, but in making money. It really brings down the standard of IIT education.
- Flocking in the metros: This really shows that the students are not interested in studying as much as they are interested in having a "good life." This trend has really picked up in the last few years. In 2003, when I went into IITs, there was still a trend of people choosing Kanpur or Kharagpur because the education there was good. But, now practically everyone chooses Bombay (or Delhi as the second option). I am sure most of students don't really know if the education is better in Bombay and Delhi. All they care about is the fat pay packages and a "good life" in the metros.
- Lower standards of teaching: I have covered this in my previous answers, but let me repeat again. There is practically no reward for teaching well other than satisfaction. It is not linked to any promotions or evaluations, practically speaking. IITs are becoming more and more focused on research and teaching is being left behind. In faculty recruitment, teaching is not even a consideration for all intents and purposes. This is not a problem only in India, but in US as well.
- Internet:I don't think many students who bunk classes are in their rooms studying or watching MOOC lectures. I do attribute this trend to internet but not in a positive way. The biggest immediate cause for missing lectures is a previous night marathon of "Breaking Bad" or "Friends" or …..
Motivation of the students is changing not only in IITs but education institutions all over India, because in general, motivation of Indian society is changing. Read more here: Brijesh Kumar's answer to Why do most people in India value others on the basis of the money they possess?