Is your point that immigrant visa takes however long it takes (>10 years for Indians), and if one is already here on H1b, they should not expect H1b to be indefinitely extended until immigration visa is approved?
For pretty much all countries other than India, there are no practical issues, since they get permanent residence well before their H1b expires.
The problem is magnified for Indians to the extent that their lives are basically in suspended animation for several years
It sounds like these people should be fast tracked for citizenship, given that they would be filling a gap in the country's skillsets.
If we invite them to move to the country, it seems fair to not kick them out for no good reason.
Wrong; it's explicitly, legally a dual-intent visa, unlike other non-immigrant visas in which immigration intent is prohibited and grounds for visa revocation. The idea of it as a path to permanent residency is explicitly part of its legal design, and so using it that way is not at all fraudulent.
Read the regulations. This idea of H1 as a path to a green card is just a fraudulent use of that visa. I am not opposed to people getting green cards — I am opposed to the idea that the H1B is some kind of back door to permanent residency.
If you want to immigrate, get the proper visa.