They are reverting to diesel, not steam. Steam is obsolete now. Because they use completely mechanical transmission, they are really bad during wet conditions because of wheel slip issues. Also, they have much lower power than diesel or electric locos making them absolutely unsuitable for steep gradients, especially with the typical 24 coach loads seen in IR. Steam is by no means better than diesel or electric locos.
Electrification has been slow and mismanaged in IR, but it is not shoddy. And no, there have been no cases of trains randomly stopping in the middle of nowhere due to power failure. India has a power shortage, but the railways are given top priority and trains stopping due to...
more... power failure are extremely rare, only during protests or natural disasters, happening once in a blue moon.