How India issues tourist visas is laughable! You just fill up the form, submit the money and the passport and some photos and pickup it up duely stamped after 5-7 working days. No checks, no verifications are conducted for majority of the countries.
I recently applied for an Indian visa and it was the worst process of any visas I've ever had to deal with. In the US, the Indian Embassy doesn't do the visa work. They outsource the work to some private company (Travisa) and that company held my paperwork hostage for about 9 days before they actually gave it to the Indian Embassy to be stamped for approval. My application was perfect so I don't know what they were doing with it for 9 days. Once the Indian embassy received it, they stamped it in one day - and promptly returned it back to the outsourcing company. In total, this was one of the most time consuming visas I've ever received (~12 days). I live in Washington, DC and all the embassies are here and I can generally show up to most embassies, pay extra, and often get my visa same day. Very easy - unlike Indian visa. Even visas to very restrictive countries like Vietnam and Burma are a lot easier and quicker to get.
12 days may not sound that debilitating, but many people who travel do not just go to one country. Often, they go to several. And if they know that an Indian visa is a pain and will take 12 days they will just skip it and go somewhere else instead.
My trip is centered around riding in Kashmir so I am planning for India and it is just a small inconvenience for me. But on my previous trips to Asia, I could've easily gotten the itch to take a quick flight to Delhi/Goa/Agra/whatever and if I learned about these visa rules and times, I would definitely not bother with the hassle.
I don't know if my experience on this is unique or typical because Travisa never got back to me after I filled out their 'customer satisfaction survey' and voiced my opinion.
On top of that, I learned that my 6 month visa carries a stipulation that if I exit India, I can't come back to India for 2 months. (unless I apply for yet more paperwork.) This is more bureaucracy that makes side trips to Nepal/Bhutan/Sri Lanka/etc more difficult and schedule more inflexible and the reason why I will probably end up spending less time - and less money - in India.
I don't really care what rules and processes India chooses for visas. It really depends on how much the powers that make these decisions in India want to encourage or discourage tourism. Different countries make different decisions on this and I respect that.
I just wanted to share my experience so you can see how an average tourist looks at it.