The Question I would like to ask is, where does Delphi stand in terms of application development tool.
I have started my career in Delphi as a fresher and have concerns of its existence in the future. I haven't heard of many people using it and preference always goes with MS tools for the reasons known.
I understand that Delphi is easy to understand and flexible, as I have dealt with other platforms although not deeper.
Please let me know if my thinking is incorrect and I would love to hear that this is untrue and Delphi is gonna stay forever :)

It is still in use. They have just released XE, and have a new roadmap for the future. You can read more on the embarcadero website.

I don't like the current direction, though. I think embarcadero screwed up on a few things... Alas.