Of course it's funny! Haven't you experienced enough of life and death to have adopted a sense of humor? It's just a grade. You could change majors or career. The guy fails and goes complete lemming.
No - its not just about a grade. Its about 'honor' , 'ego' , 'self-respect'....competition with your friends and rivals. Stuff like that. I have been through that myself. Performace in the exams is an estimation of a guy or gal's self-worth in India (and probably Japan/China).