Before getting an Oscar, let's see if a Bollywood star/film would even get the most prestigious film prizes from the Government of India. Look at the exalted list who have received the Dadasaheb Phalke Award, India's most pretigious film award:
http://en.wikipedia.org/wiki/Dadasaheb_Phalke_Award
To be fair, I would expect names like Amitabh Bachan and Rajnikanth to receive the award soon but it's important to stress that Bollywood is not the be all and end all of Indian Cinema.