I spoke about this bill to my friends in India and they said its only a draft and the actual bill may not be so harsh, also they informed me that therere many cases yet going on in Indian courts regarding the approval of bitcoins. Indian government aim of launching its own crypto shall be a waste of their resources, as no one will buy their centralised crypto. In my opinion Indian government should look at Japans model regarding bitcoin, and implement the same in their country.
You are partially correct. The final bill is likely to be a toned down one. If they make the bill too harsh, there will be some public outcry and it will be challenged in the courts. And moreover, it will be almost impossible to implement these harsh measures in a country with millions of people who use cryptocurrencies such as BTC and ETH.