Local exchanges were preferred, but after 30% tax, and 1% TDS was implemented, people started to prefer overseas exchanges like Binance and rest as mentioned in op.
I always thought India was a hub for tech and mushrooming start-ups, and with this I thought Government always had support for them. To see the Government try to strangle innovation with extreme measures is quite disturbing.
I think Nigerian Government tried a similar ban on crypto trading. People went p2p and then a few days back, I saw that they were reversing the decision. They probably regretted what they did in the first place.