Obviously on Android there's sideloading, even on iOS to a lesser extent, but I think the idea is that if there's any technical hurdle required to overcome this limitation, then the bad people will be less likely to use the workarounds. Obviously some percentage of criminals will do these workarounds, and I suspect the lawmakers even know that, but I think the idea is that any percentage reduction of criminals being able hide stuff is positive.
To be 100% clear, I think this is a very bad proposal; I think E2E encryption is important and should be protected, not threatened, I'm just saying that the rationale isn't completely incompetent.
Repos like F-Droid will keep hosting them.
Forbidding installing apps from non-official sources is obviously bad and I don't think most people want it.