I performed the diagnostics at Apple's authorized service center, connected with Apple support, and created a Case record. My phone is currently out of warranty. The diagnostic report clearly says there is no physical damage or liquid entry in the phone, and it is completely an internal failure. The repair cost quoted here is ₹33,000 INR, which is more than half the price of the phone itself - even if we go with that, the display warranty is just 3 months.
I am demanding an exception since this is not due to physical damage and is completely a manufacturing issue I am not the only one facing this, as thousands have reported the exact same problem. The support team gave me false hope in every call, promising to try for an exception approval and scheduling callbacks for the next day at noon, only to ghost me without calling back. After speaking to 5 different support persons, the final one simply said they can't help just because the phone is out of warranty. They are simply giving false hopes and wasting a consumer's time!