On the one hand, the government will actively fight this, but on the other hand, there will always be officials and police who will be ready to help this business for bribes. In
I do agree 30% tax is too much to handle in the current economic situation. However, the Indian community found a loophole and they left Indian exchanges to hide their capital gains. Which was working for some time now until the government placed a shadow ban on international exchanges. We still can access those exchanges but a new user can't due to the unavailability of these apps on both the Google store and iOS app store.
Yes, the stupid law has encouraged activities that are term illegal and unless the government does not come up with a new tax scheme these activities will increase. If the government does not then a lot of big traders will leave the country and go to tax heaven like UAE or will come up with new exchanges like Pi42 exchange which is only a futures exchange in India. As the government has not come up with a tax law for future trading in cryptocurrencies this exchange is now thriving. Although I believe that futures trading is nothing more than gambling.
I don't think new users will have problems because you can always use the web interface.
Prohibition policy always works badly. A professional will always find a way to access the exchange, while a beginner usually loses money on the exchange.