I can make out that I am unable to recall the things as earlier I use to. Something like retrograde amnesia. Is this dementia like thing progressing to some serious mental illness? I am so very confused to take any step for it in a right direction..

Get evaluated. Poor performance can be triggered by lack of proper sleep, medical illness, stress and poor nutrition to name a few issues. Write down the pattern you have experienced, the duration and any other features you recall & take that list in for a medical checkup.