Dozens of talented players have emerged in recent years and the likes of Thomas Mueller, Manuel Neuer, Mesut Ozil and Mario Goetze have made the gradual transition from youth-team footballers to leading internationals.
"Borussia Dortmund are a great example with Goetze, Marco Reus and Sven Bender. We have many young players coming out of the academies and I think German football has made a quantum leap," Dutt told Reuters Television in an interview.
Mediocre performances by the national team at the 1998 World Cup and Euro 2000 led to the overhauling of the youth system by the triple world and European champions.
"There is superb work being done now in the academies, some very skilful and tactical training," said Dutt.
"It started in 1998 with the first talent development programme and in 2002 came the first youth academies. You could not yet see the fruits of that labour at Euro 2004, that is why we were knocked out early in Portugal, but after that it has been only up."
At Euro 2012 Germany had nine players under 23 compared to one - Sebastian Deisler - in the same competition 12 years earlier.
"The fruits could be seen at the 2006 World Cup for the first time and in recent years at club level too. There are more and more younger players emerging," Dutt said.
Germany have reached the semi-finals in the two major competitions every time since 2006 and at the 2010 World Cup in South Africa they fielded their youngest tournament team in 76 years.
This season three Bundesliga teams progressed beyond the Champions League group stages, with Dortmund and Bayern Munich getting to the quarter-finals.
Bayern have twice reached the Champions League final in the past three seasons, relying on a core of their own players with Mueller, Toni Kroos, Holger Badstuber, Diego Contento, Philipp Lahm and Bastian Schweinsteiger.
Under rules established more than a decade ago all clubs in the top two divisions must have regularly-rated youth academies in order to be granted a licence to compete.
Similar conditions do not exist in other countries, said the German Soccer League (DFL).
As part of the licensing programme for the 2011-12 season, the clubs in the top two tiers pumped more than 100 million euros ($129.97 million) into their academies, taking the overall tally since 2001 to more than 713 million euros of direct youth investment.
The youth systems of the clubs have helped increase the amount of home-grown players and the most recent DFL statistics for the 2010-11 season show 275 out of 525 in the Bundesliga - a staggering 50-plus percent - emerged from the academies.
This has also fed into the national teams with every Germany Under-21 footballer in the 2009-10 season having been a product of the academies and 21 players out of 24 in the Under-20 team.
Apart from the professional clubs, there is also a systematic development programme led by the DFB.
A four-tier model starts at kindergarten and includes local club level and school development all the way to talent and elite programmes at DFB bases around the country.
The idea is no outstanding player at any level will go undiscovered.
"We have a very wide net in Germany. We have state federations, we have DFB bases, we have youth academies with their elite schools, we have the youth national teams," said Dutt.
"It is practically impossible for a talent to slip through the cracks.
"It is also good to have a second level. Not everyone can play in the Under-16, Under-17 national teams...(Germany international) Andre Schuerrle first emerged in the Under-19s for example.
"Goetze has been there from the Under-15s so we have a lot of catch basins providing different ways of becoming an international."
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