It's mentioned in this changelog item: https://github.com/Telegram-FOSS-Team/Telegram-FOSS/blob/847...
It usually takes some time for Telegram to be published on F-Droid, so the newest version on F-Droid is 7.2.1 while the newest one on Android is 7.3.1. It might contain such a menu on the newer version like in that screenshot. Or the button only appears at that place if you have enabled location sharing.
But I also see a lot of folks on it....so it us concerning if it isn't opt in for non-F-Droid users?
Barring no exploits, you have to press "Make Myself Visible" and then confirm with a popup in order to share your location.
Edit: I turned enabled location sharing under iOS settings for Telegram app and "Find People Nearby" is now showing as the first list item under the Contacts tab.
Most folks would be inclined to look under "Settings" rather than "Contacts" for something like this. How strange!
I think the assurances that this offers (entirely FOSS, reproducible builds, better privacy and security[3]) outweighs being sometimes days or weeks behind the releases they upload to the Google Play Store.
[1] https://github.com/DrKLO/Telegram [2] https://github.com/Telegram-FOSS-Team/Telegram-FOSS [3] https://github.com/Telegram-FOSS-Team/Telegram-FOSS#changes