birdspeed :
in Delhi FIR, dense continental airspace ? I hope you are being sarcastic ,
Offset has been debated since decades, from embedded 0.1 NM, to 1 or 2 NM in oceanic, etc.. there are mathematical reasons against it. , so it will never pass ICAO. . google it if you want the discussions.
anyway as DaveReidUK pointed out , this incident is same direction, so would not have helped.
250 Kts :
Refusing to fly though an airpace , whow !, you can do that ? I am impressed . As to the source of culpability , have a look at ICAO phraseology manual (Doc 9432) it unfortunately does not prevent the phraseology used here or in Manilla. I have been trained in the 70'sin Europe to say for instance to an aircraft requesting a specific FL : e.g. "not available due traffic" and/or "expect 350 in 10 minutes." that was standard by then . . in the 90s, to avoid the above, we were in my unit recommended to use "higher" and "lower" instead of mentioning the Requested FL. but this not ICAO phraseology.
In any case unless the words " cleared to " or "Cimb to" are used it is not an instruction , and sometimes you do have to mention the next level in full , e.g in conditional clearances.
It is not ideal I agree, therefore it is important to pay attention, finally an English level 4 crew should be able to understand the difference between expect and clear to .