Or, if you extrapolate this argument further, you could even wonder why the entire world can't run on a single timezone.
But here's the problem: for example, imagine it's UTC everywhere on Earth. No local timezones.
As per your solution, people in India can go to sleep at 4:30 pm (UTC), wake up at 12:30 am, have lunch at 7:30 am etc.
Likewise, people in San Francisco can go to bed at 6 am, wake up at 2 pm, have lunch at 9 pm etc.
Now, the problem is, when someone wants to setup an international meeting or whatever, nobody would have a clear idea or whether it would be "sleeping time" for any of the participants involved, without having to look it up.
Like, with the current setup, it's kind of universally understood that 3 am local time is sleeping time, hence people would avoid setting up meetings at that time.
But if everywhere on Earth it's the same time such as UTC, I would have no idea if 3 am UTC is your sleeping time or lunch time or whatever. I would have to maintain lookup tables of when the sleep time, lunch time etc would be for every country as per UTC.
Similar problems exist (to a lesser degree) when large countries move to a single timezone.
Yes there are flaws in the existing setup, but moving to a single timezone for large countries would only introduce a new set of challenges.