But talking about Indian Local board it definitely is one of the reason why the place is becoming ghosted. 
You never know whether more merit would attract more people in your local board. Few years ago Croatian board got few new merit sources (after being one of the least merited boards) and it didn't really help us much when it coesm to activity as it keeps decreasing, even though we (probably) have more merit available than ever before. Theymos needs to decentralize the merit source. Right now it's used as a political tool to reward people he likes.
I don't see how that would increase forum activity.