Please do not tag me as Rubina fan, this year there is not contestant I would vote for. As for English understanding I'll let the statistics speak, check Wikipedia for languages of india.
. English is second most spoken language and it is understood even in the interiors was travelling in south a water seller gave directions in English.
Let's leave south of india outside of this discussion. Primary Hindi BB audience is not South of India as they have their own Big Boss in state language. Bollywood and all Hindi channels' target audience is North India where they predominantly speak some dialect / form of Hindi and urdu.
Hope this clears why urdu is allowed and not English.