The point is that India is a sovereign republic and has its own laws about what is illegal and is not. According to India's laws, spreading false rumours about the police shooting a farmer when there is clear evidence that the person actually died by running his tractor into a barricade is illegal. And when Twitter failed to comply with government's orders to remove these tweets, they didn't have any point of contact from the company they could turn to for accountability. That's why the need for the compliance officer.

Also, criticizing the government is not illegal according to Indian laws.

Illegal is just whatever the law says is illegal. If you make a law making dissent illegal, then that content is illegal. So now you have to define 'real'-illegal and 'I do not like your opinion'-illegal in the law of some other country.