What do you need to store in the kitchen proper? You already have crockery storage and food storage elsewhere. Just tally what you actually need to store and provide space for that. You may not need all built-in cabinets; shelves, hooks, or pegboards may do as well. And yes, the utility room is very tight....it look like just a 24 in (600 mm) wide passage? I'd scrap the sink rather than squeeze it in so tight. Do you really need separate spaces for utility, kitchen and store? If you combined these all and planned them carefully, you could have a large, very functional kitchen, at least by US standards. (Not being familiar with exact kitchen norms in India, I can't fully comment on the tradeoffs.)

Seems weird not to incorporate it into the design -- I'm all about having things "look intentional" rather than working around them later. Like could the island have connected to this, rather than extending past it? or been L-shaped, so there's room for an extra stool, and also a wall cabinet? Anyway, hard to discuss that in the abstract without kitchen plans. I'm with miacometlady's original advice to not worry about it right now, and decide how to deal with it once the bulk of your kitchen is in place. You might find that you hardly notice it, with all the beautiful new finishes, or it might seem obvious to put some stainless or glass shelves there, or maybe simple is best and one simple hanging picture does the job. Don't stress about it until After. :)

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@Rock Doc: Are you addressing this to me? I haven't actually bought these tiles yet - when I do, I will definitely be going for the handmade ones. They're a work of art and irreplaceable in my opinion. However, there are also screen-printed tiles available in the market in more or less the same patterns; the workmanship is of course different, but you get them cheaper, and they're also more easily available. You could give that a shot. I'd recommend Aakaar Flooring Solutions - they're here on Houzz and are able to provide both the above-mentioned types.