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I know where you are coming from. I am in my final year in a tier 3 private uni, but in my 2nd year I was in a pretty similar situation. Till my 5th sem, I had just one internship in the district court, zero publications and one unheard moot. Then COVID hit and everything shut. It was then that I started working because I too felt a lot of pressure. Point is, I worked my butt off for three years and scored a PPO at a tier 1 :) and you can too! Three years is a long time so don't stress about it too much. Just do these things:
1. Ignore moots - no one cares. Even if you want to litigate, moots have no relevance because they are "not at all" how real courts function. So, how do we bridge this gap? Plus, 3rd year is not a good time to moot, especially since you have a lot on your plate already.
2. Intern - keep interning all the time. Start applying, fire away mails, approach people on linkedin. The best part is you are in Delhi! Go directly to chambers, submit your CV. You will get rejected, but its part of the process. I had mailed almost 40 partners when I wanted internships, 2 responded lol. So, don't feel down if you don't secure any, someone will accept. Plus, litigation is much better in terms of internship support. Some advocates genuinely help interns.
3. Publications - You will get ideas for publication once you start interning. How? You will definitely come across some grey areas while you intern and you can convert the research you do in these areas into a first rate blog or paper. Have done the same, has always worked :) aim for 4 to 5 publications minimum till your final year in reputed (unpaid) blogs/journals. Or, if you have the capacity you can do more.
As far as the point where you feel you won't be competent enough, friend, the fact that you are scared that you won't succeed is in itself a sign that you will do something :) Use this as your motivation. Start 1 step at a time and you will achieve your targets.
You just have to focus on 2 prongs: interning all the time and publications. I think we can agree getting good grades in law school is pretty damn easy and straightforward. Aim between 8 to 9 CGPA and you will be set.
All the best!