I don't know if you are being serious in your argument about having religion decide the leadership! But assuming that you are, here is my argument.
The setup you described already existed in India and very specifically in J&K -- a person from majority religion as PM/CM and representation from minority religion in his cabinet. Mind you, this has been the case in J&K even as we speak right now!
But did that stop riots in India and in J&K in particular? Even as recent as last year, there were communal riots in J&K.
So how does your mode of governance help do anything better? Not only does it help mix religion and politics, it breeds nepotism, disregard for developmental agenda -- and serves nothing apparently.
The current system in India -- although not perfect, has a far greater chance of working in the long run!!
Let the people decide what is important for them -- caste/religion based politics or development. They will get what they deserve, in the end. Ask people from UP!