My personal opinion is less about the crowding (though that is a pain) and moreso how overtourism creates a form of Dutch disease and prevents more inclusive economic from being created.

The state in India I mentioned (Himachal Pradesh) has a large tourism industry, but because of strict zoning laws was able to reduce the overall impact of tourism and zone SEZs and industrial parks which helped MSMEs climb up the value chain in industries such as generic pharma manufacturing and food processing.

If hotel and homestay zoning was lax, there would have been less of an incentive for local capital to invest in capex heavy but ultimately higher value economic output. And it was that economic output that helped HP subsidize it's welfare system that was able to bring the state's HDI to middle of the pack Chinese province levels despite not having a single metro with population greater than 200k.

I know HP lol I live in India

I hadn't thought of it from your PoV but it makes sense.

And I had just been to the Sar pass trek from Kasol, and let me tell you. It's insanely over crowded right now. Despite the regulations.

On our trek we easily had 300+ people at 13k feet!

So I fully support such decisions because small towns can't handle such crowd