What is Western Dress Code? A confused answer

There was a time when apparel means saree, salwar, kurta and dhotis, but things has changed in past decade that everyone talks about western dress with something in mind. I never understood what they meant and once I started to deal with it professionally things became even more confusing. What I learned is that western dress is not a group of apparel, it's a way of living.
The dress code has always been an informal rule of morality. No written codes or rules exist anywhere in the world except in schools and some formal organisations. Generally in modern society, who decides what is a dress code? or who defines which dress code is appropriate and another is inappropriate - answer cannot be said in one word or one sentence.
Along with globalization and internet boom, there was a whole new generation of people who split their time between multiple countries and cities who consciously or unconsciously adhere to the societal standards of immoral and moral. With more and more people migrating to one city or another, even embassies and governments were forced to issue a dress code which again left many bureaucrats and officials with unanswered questions. At every instance when a formal authority was forced to issue a dress code, the statement starts with a vague sentence of open mentality of their citizens but subsequently with a "however", they will change the tone of subject to an open mentality to an "accepted behavior"
In South Asian countries and the Middle East, western dress simply means skimpy clothes. There is nothing more to it. Who says the western dress is all about revealing. Who created this mentality that western dress is all about showing cleavages, shoulders, and thighs. In a country like India, either there is traditional - Sarees, Salwar, Dhoti OR Western - Anything other than traditional. It would be surprising if anyone talks about eastern dressing, Japanese dressing or African dressing. Even in the fashion industry, either a model will wear traditional or if not traditional, then western - There isn't a third category.
Parents and adults are also confused when they need to express their concern regarding revealing skin. To find a common ground, they always tend to say - "Wear something traditional, not western" which in fact is another way of saying don't show your skin. It is interesting to find that some people exclude denim jeans and sweaters from western category and due to difficulty in classifying them as traditional, they tend to refer these dresses as "casual". So, in short. Do western means showing skin? If that is so, does it mean all people in western shows their skin?
If you ask a western person, what is his/her dress code, you will hear answers which are no different than people who will answer these questions in India, Middle East or any other country. They all wear T-shirts, they all wear track pants, they all wear the same stuff produced by the same multinational company. So, where is this difference?