Istio 1.21.3 update

[strekm]

Description

Update the Kyma Istio module to use new Istio version. Update Istio version and used dependencies, adjust tests and documentation if needed. The upgrade needs to have zero downtime for production settings.

ACs:

• Review Istio RNs.
• Verify that the new Istio version doesn't introduce features that transition to a new phase in Istio, potentially affecting Kyma's Istio behavior. If such changes are identified, discuss them with the team to determine the best course of action.
• Istio bumped on the main and latest release branch.
• Prepare Kyma runtime Istio RNs based on open-source Istio RNs.
• Istio installs and upgrades to new 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.
• Istio and Envoy Version updated in the README.md and /docs/user/README.md files. You can use the scripts scripts/get_module_istio_version.sh and scripts/get_module_envoy_version.sh to extract the versions.

DoD:

• 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.
• As a PR reviewer, verify code coverage and evaluate if it is acceptable.
• Add release notes.

Attachments
Istio Release Announcements

PRs:

• Bump Istio to 1.21.3 #877 (main)
• Bump Istio to 1.21.3 #882 (release-1.6)
• Bump Istio images to 1.21.3 test-infra#10986