What do you mean by real world? Our country need PhDs. I particularly observed here in NUST that our professors are working on real world problems, conducting high impact research. Pakistan is a rising star in the research community. We are the only country where the research output is increasing each year at a scale of more than 200% increase per year. You may not realize at this stage but later on you must realize that how much direct impact of these people have on the economy of our country.
Only if we consider the economic advantage of PhDs on our country, as an example, only my current adviser is getting million dollar research projects from overseas and all this money is being spent locally on students and professionals (hired as research assistants) in the form of their salaries according to expertise.
If this research trend continues, we can commercialize our research and can produce some novel products which will benefit our country in long term.
I also had a misconception like you that research is something theoretical and bla bla bla
But now I realized its impact and its immediate practical impacts on our society.
We can have this discussion some how offline (may be at skype or phone ), if you are interested.