They seem to be abandoning China, they are planning to move some 40% of the total iPhone production to India within the next couple of years, so China might not have all that much leverage.

They have to respect the laws of the countries they operate in but they don't necessarily have to do so silently.

If you go to set up encrypted backups and find out the feature isn't available or get a message saying something like "Feature cannot be activated in China, Turkey, and Russia", that's better than the feature not being available anywhere.