Her words were that they are preparing a note to thee Cabinet on it. The cabinet will then take a call and then propose it to the legislature as a bill.
It is still in early stages, but if Nirmala Sitharaman's words are any indication, they seem to be contemplating allowing crypto currencies to circulate in a regulated manner. Balajis mentioned that crypto could be treated as a foreign exchange currency. You can hold, for example, USD as an Indian resident, but it is not legal tender for exchange and is taxed (not sure about this) if you use it for the purpose of trading.
Germany also treats crypto as private money, not as an asset/investment to be paid capital gains on. I think this is a nice, legal alternative for crypto.
Untaxed, illegal transactions for large sums are a big problem in India (especially in Real Estate/property markets), so the govt. is trying to walk a fine line in regulating without killing the crypto market.
One interesting advantage of crypto to India would be that it will allow India to bypass USD and SWIFT , and whatever scheme China cooks up in the future. This will really dent the ability of the USA to abuse the Dollar's status as the reserve currency to stop printing tonnes of money and raking up public debt in the long term without facing inflationary consequences.