Just to clarify, it doesn't mean that people getting 100% marks don't have capability. It just means that when a large number of people get those marks, you can't differentiate between people. As in the above example of 1+1, everyone can answer it, including Einstein and others. Answering the question doesn't mean that Einstein doesn't have the capability. It just means that Einsteins can't be differentiated by questioning 1+1. If it's used, we treat all as Einsteins, which is unfair.
In short, +2 exams and entrance exams serve different purposes. One is for testing basic competencies, other is for selection. It's better to keep both separate.
5. +2 exams are important of rote learning: Year end exams influence the nature of teaching in class rooms. If the exams are based on questions that require rote learning, the learning in classroom is also geared towards that. If the exams ask questions involving a deep understanding of cconcepts classroom learning also strives to achieve that.
In India, +2 exams are as rote as an exam can get. The questions are usually from the exercises at the end of the chapter. Students are tested repeatedly on these same questions, so that they reproduce appropriately.
Using +2 exams for admission to engineering and medical entrance will increase the stakes and only promote rote learning.
A hard working "urban" student should thus be differentiated from another "urban" student that didn't put required efforts. Similarly, a "rural" student that didn't put required efforts should be differentiated from a hard working "rural" student with a similar background.
+2 exams don't do that because of their poor differentiating capability, as discussed above. With a high number of students scoring top marks, seat allocation parallels a lottery for all practical purposes. It does disservice to students, as it fails to differentiate students "within groups" (urban or rural) and places everyone on the same plane.
Remember that attempts to enhance the quality of +2 exams, thereby increasing their differentiating capability, will again lead to the same concerns cited regarding entrance exams (access to quality colleges or coaching).
Finally, as Akilan points out, TN stopped collecting "rural/urban" data of students. He asks "Where is the government data on admission of rural students? Are we just whipping emotions using anecdotes that fit our narrative?"
Thanks to Akilan for educating me on this topic. I benefitted from discussions with him.