Windows 8 does not recognize HUAWEI Y536A1 for debugging
First make sure that you have virtualization on in the BIOS. 

Next, make sure you have done what I have done in my question.

What I forgot to do was install the android_winusb file in the usb_driver folder. The path should be sdk\extras\google\usb_driver. In my case, C:\Users\Ruchir\AppData\Local\Android\sdk\extras\google\usb_driver

After doing that, go back to device manager and go to the install as path. At the bottom of that should be another option:


  Let me pick from a list of devices on my computer


Select your Android phone; it shouldn't have a yellow exclamation point over it any more. After that, select Composite ADB Interface. THAT'S IT.