In many cases, funding and publication happens with a non-disclosed compromise between two known persons. In that case, the output of science is reduced a lot. But its unimaginable how much this problem is affecting the value of science. In many state Universities and Institutions, scientific work is being hindered by bureaucratic officials and in many cases people (especially student fellows) face problems receiving the release of fellowships by the parent organisation/funding agencies. So, if such problems could be removed, what could be the output of scientific efforts in India or world wide?
You would have to compare the current situation with a system elsewhere which lacks the problem. In Britain that might well mean comparing the present system (where researchers have to apply to the research councils) with the past system where science funding was channeled through the universities. From what I hear, the past system tends to be considered as the better one.
Yes, at the root level, the person can be judged better for example at University or Institute level. On the other hand, some times blind review of submitted project also helps a lot for selection of the right candidate by the research council/funding agency. However, in both the cases if name is disclosed then a huge partiality limits the right candidate to be absorbed or funded.
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