Is a foreigner considered Illiterate if he only can read his home language?

My understanding is that when someone is illiterate they cannot read or write any language, so I would say the answer to your question is no.

Yes, if he is at a foreign country and no one knows that he’s a foreigner.

No, but they may as well be. That’s why we have a third classification, “Functionally illiterate”. This is for those that technically can read, but with serious limitations. My last job had a functionally illiterate supervisor; smart guy, but could only read/write Spanish, despite being able to speak English passably. Many dyslexics also fall into this category because their reading speed is often low; they may understand what they see eventually, but not in a timely enough manner to be useful.

Not that way. Illiteracy has got nothing to do with language skills.

I’d say No, not unless that person actively refused to learn the language.

I think such a classification would be more of a reflection the judger rather than the judgee.

No. Literacy is the ability to read. The language is immaterial.

No. Would you consider yourself illiterate if you were working in Bangkok? I’m just assuming you cannot read Thai at this point.