Also, I don't think India is unique in negative coverage. With a newspaper as big as the NYT you're bound to find something negative, but every country gets primarily negative coverage, including the U.S. That's the news that sells.
This is my biggest frustration with the urban Indian middle class (which forms a very small slice of the population). We are almost completely unaware of how the rest of the country has been suffering over the last many years. A very visible example of this was the BJP India Shining campaign, which led to a massive electoral defeat. The BJP thought India was doing awesome because their entire worldview was centered around the Delhi middle class, while the rest of the country looked upon buses driving by with India Shining posters as a cruel joke. And the BJP faced the consequences in that election.
With respect to rural India, I honestly don't know enough to comment.