Istio 1.20.3 bump

[strekm]

Description

Update Kyma Istio module to use Istio in version 1.20.3 Update Istio version and used dependencies, adjust tests and documentation if needed. Upgrade needs to be with zero downtime for production settings.

ACs:

• review Istio RNs
• istio bumped on main and latest release branch (release-1.3)
• prepare kyma istio RNs based on Istio RNs
• istio installs and upgrades to 1.20.3 version
• istio module upgrades with zero downtime - Zero downtime upgrade test #429
• tests and documentation updated if needed
• verify that sidecars are in sync with control-plane

Reasons

Keeping Istio up to date

DoD:
- [ ] Create a follow-up issue.
- [ ] Provide unit tests.
- [ ] Provide integration tests.

• Provide documentation.
• Test on a production-like environment.
• Verify if the solution works for both open-source Kyma and SAP BTP, Kyma runtime.
• Check the outcome of all related pipelines.
  - [ ] Verify resource limits.
• As a PR reviewer, verify code coverage and evaluate if it is acceptable.
  - [ ] Create a release
• Add release notes

Attachments
https://istio.io/latest/news/releases/1.20.x/announcing-1.20.2/
https://istio.io/latest/news/releases/1.20.x/announcing-1.20/upgrade-notes/

PRs

• Istio 1.20.3 #620
• Cherry-pick Istio 1.20.3 #621

[videlov]

Istio introduced a fix in Istio 1.20.2 with:
istio/istio#48491

which did break our k3d integration tests. issue was reported for this:
istio/istio#48746

this is now fixed with:
istio/istio#48757

which will be released with Istio 1.20.3 so we have to wait for it.

[howardjohn]

@videlov I am surprised this broke k3d, its actually for a different reason that the issue you linked (though quite similar). That being said I did test 1.20.3 with k3d and it fixes the issue as well fortunately, so you should be good to go on that version.

[videlov]

@howardjohn we actually tested 1.20.1 only with the commit I mention and it did break our k3d setup, however the fix resolves the issue, we also managed to validate it. thanks for fixing it so quickly. hope 1.20.3 is released soon.

[videlov]

Istio 1.20.3 is out - https://istio.io/latest/news/releases/1.20.x/announcing-1.20.3/