Even though there is a seeming saturation, if we look closely the saturation is restricted to the cities and bigger towns. Moreover, there is a real deficiency of quality dentists. The seeming saturation is an increase in quantity of the dentists whereas the quality dentists still are less than the demand.
Personally, I have seen quality dentists and specialists coming out on top (sometimes they may get their wings a bit late but they fly high like the eagle....) - this despite the large number of specialists around them.
Also, I feel that with the population of Indian subcontinent, saturation is a relative term. There are many pockets of India where dental treatment is unknown and dental clinic is non existent. The problem being setting up a practice there can be less rewarding until it really picks up and no one is ready to take that daring step. Also, the standard of living is a question to answer .... considering dentists have a family too to take care of and one has to think of their children as well as to where they grow up and so on!
So the question is perhaps better reworded as how to tackle the present situation of saturation in India in major towns and cities ? My answer is, the best of the lot come out on the top ... so personally, one just has to strive to be on the top with an eye for skill enhancement and be open to learning new skill sets with an excellent flair for interpersonal communication. It is what I have seen ... highly skilled dentists are highly rewarded financially as well as in popularity.
Ratio of dentist serving to population is still lacking it is 1:2.5 lakh in rural. it is true as stated by Akilesh Ramasamy. Many factors are responsible. 1. Why Dental colleges are more near big cities not in rural areas ? (4-5 Dental colleges with 30 km area in Chandigarh). 2. lack of awareness about oral health and paying capacity of the patients in rural area(Extractions and denture fabrication is the most common treatment given, not by dentists but by the quacks due to the cost factor and non availability of dentists.) To solve this problem, the government should set clinics in rural areas rather than opening vacancies in urban civil hospitals. Punjab government recruited 148 vacancies after 13 years 2 years back.