Relative ranking is something no one should adopt unless they have a population problem. Unlike SAT, your rank relative to your peers in the exam decides your fate. The problem with such system is it encourages people to participate in the race earlier. Parents are sending their kids earlier to JEE prep every year and increasing the difficulty. It will continue to go up unless it's humanely impossible.
Coaching industry built around it has bigger market value and revenues than government spends on IIT (the test that JEE is supposed to get you in).
Our most valuable startup is byjus, an edtech focused on helping students pass JEE. More and more foreign companies like Amazon are also opening JEE prep centres here.
Despite above, our educational outcomes in higher education are worse than most developed countries including US. (We are good at employment at tier 1 colleges though)
These students get burned by the time they get into college of their choice. There isn't much focus on actual academics and coursework unlike developed countries where universities get more difficult. Further, most students are encouraged to practice leetcode from year 1 instead of focusing on academics.
Everyone is slacking off after getting in so curving keeps their grade good despite a huge drop in effort.