It's because I don't think he poses a threat in test match cricket. At least not really. Sure, he'll bowl you some good balls and will get set batsmen from time to time (although I'm not sure the example of getting Rahul and Pant after they've got tons is the best proof of that, even if it was important in the match situation), that is the allure of a leggie.
His issue though, is I think, that the skills that make him (and bowlers like him) successful in ODI cricket are very different to the skills that make a good test match leggie. He's not particularly accurate, he's prone to bowling bad balls, and he can't build pressure. His strengths are his variations, and they're less important in test cricket. The result is that he needs to bowl a magic ball (or be bowling in very friendly conditions) to get a player who can pick him out, and that's just not sustainable. Only in very limited scenarios (such as the Sri Lanka series where England could play 3 spinners and only use Rashid when they could afford to attack) will he succeed. The reverse of that is Yasir Shah who is a very good test match leggie, but gets smashed in ODI cricket.
There definitely needs to be a recognition of talent. My take on it though is that if you're good enough, you're good enough to prove it with a red ball too and that the benefits of keeping open that CC pathway are worth asking talented players to back it up (as Stone and even Archer have). I accept that's not clear cut mind, but it's worth asking whether Jos Buttler, the one success we will agree on out of this policy, may be an even better test player had he been told that he had to find more time to play it over the past few years if he wanted to be selected again? I don't know the answer actually, he admits to learning a lot playing in T20 tournaments and you wouldn't want him to burn out, but it's definitely worth posing.