For the first aircraft designed and being built within the country, the government should have been more considerate. However, the people incharge are in their 50s and have there own set of beliefs. A 'senior' babu is like that uncle who doesn't give a hoot about others. What do expect from a relic organisation (UPSC)? They're not producing the brightest lamps.
India, post liberalisation, has been hampered so much by lobbying, corruption, indifference, and political agitation that the DPSUs behave like any other PSU. Look at the general state of any government office and then paste that to the MoD. People do not realise how much effort has been put in to get even a single FA produced in the country (forget about the engine).
However, those who spit on HAL for Mk1A or Mk2 should remember that no private consortium in India has stepped forward to produce any FA (whatever the reasons might be).
The aircraft itself happens to be a good 4th gen FA for the first attempt.