Azure ARM Template for flexible mysql server gives "Internal Server Error"

I am trying to deploy a MySQL Flexible server cluster using ARM Templates and terraform (since terraform doesn't have any resource for mysql_flexible) but it gives me the following "Internal Server Error" without any meaningful information.

Please provide string value for 'version' (? for help): 5.7 {"status":"Failed","error":{"code":"DeploymentFailed","message":"At least one resource deployment operation failed. Please list deployment operations for details. Please see https://aka.ms/DeployOperations for usage details.","details":[{"code":"Conflict","message":"{\r\n "status": "Failed",\r\n "error": {\r\n "code": "ResourceDeploymentFailure",\r\n "message": "The resource operation completed with terminal provisioning state 'Failed'.",\r\n "details": [\r\n {\r\n "code": "InternalServerError",\r\n "message": "An unexpected error occured while processing the request. Tracking ID: 'b8ab3a01-d4f2-40d5-92cf-2c9a239bdac3'"\r\n }\r\n ]\r\n }\r\n}"}]}}

There's not much information when I paste this tracking ID in Azure Activity Log. Here's my sample template.json file which I am using.

{
   "$schema" : "http://schema.management.azure.com/schemas/2014-04-01-preview/deploymentTemplate.json#",
   "contentVersion" : "1.0.0.0",
   "parameters" : {
      "administratorLogin" : {
         "type" : "String"
      },
      "administratorLoginPassword" : {
         "type" : "SecureString"
      },
      "availabilityZone" : {
         "type" : "String"
      },
      "location" : {
         "type" : "String"
      },
      "name" : {
         "type" : "String"
      },
      "version" : {
         "type" : "String"
      }
   },
   "resources" : [
      {
         "apiVersion" : "2021-05-01-preview",
         "identity" : {
            "type" : "SystemAssigned"
         },
         "location" : "eastus",
         "name" : "mysql-abcd-eastus",
         "properties" : {
            "administratorLogin" : "randomuser",
            "administratorLoginPassword" : "randompasswd",
            "availabilityZone" : "1",
            "backup" : {
               "backupRetentionDays" : "7",
               "geoRedundantBackup" : "Disabled"
            },
            "createMode" : "Default",
            "highAvailability" : {
               "mode" : "Enabled",
               "standbyAvailabilityZone" : "2"
            },
            "network" : {
               "delegatedSubnetResourceId" : "myactualsubnetid",
               "privateDnsZoneResourceId" : "myactualprivatednszoneid"
            },
            "version" : "[parameters('version')]"
         },
         "sku" : {
            "name" : "Standard_E4ds_v4",
            "tier" : "MemoryOptimized"
         },
         "type" : "Microsoft.DBforMySQL/flexibleServers"
      }
   ]
}

I tested your code and faced the same issue . So, as a solution you can try with below Code :

provider "azurerm" {
  features {}
}
data "azurerm_resource_group" "example" {
  name     = "yourresourcegroup"
}
resource "azurerm_resource_group_template_deployment" "example" {
  name                = "acctesttemplate-01"
  resource_group_name = data.azurerm_resource_group.example.name
    parameters_content = jsonencode({
        "administratorLogin"= {
      "value"= "sqladmin"
    },
    "administratorLoginPassword"= {
      "value": "password"
    },
    "location"= {
      "value": "eastus"
    },
    "serverName"= {
      "value"= "ansumantestsql1234"
    },
    "serverEdition"= {
      "value"= "GeneralPurpose"
    },
    "vCores"= {
      "value"= 2
    },
    "storageSizeGB"= {
      "value"= 64
    },
    "haEnabled"= {
      "value"= "ZoneRedundant"
    },
    "availabilityZone"= {
      "value"= "1"
    },
    "standbyAvailabilityZone"= {
      "value"= "2"
    },
    "version"= {
      "value"= "5.7"
    },
    "tags"= {
      "value"= {}
    },
    "firewallRules"= {
      "value"= {
        "rules"= []
      }
    },
    "backupRetentionDays"= {
      "value"= 7
    },
    "geoRedundantBackup"= {
      "value"= "Disabled"
    },
    "vmName"= {
      "value"= "Standard_D2ds_v4"
    },
    "publicNetworkAccess"= {
      "value"= "Enabled"
    },
    "storageIops"= {
      "value": 1000
    },
    "storageAutogrow"= {
      "value"= "Enabled"
    },
    "vnetData"= {
      "value"= {
        "virtualNetworkName"= "testVnet",
        "subnetName"= "testSubnet",
        "virtualNetworkAddressPrefix"= "10.0.0.0/16",
        "virtualNetworkResourceGroupName"= "[resourceGroup().name]",
        "location"= "eastus2",
        "subscriptionId"= "[subscription().subscriptionId]",
        "subnetProperties"= {},
        "isNewVnet"= false,
        "subnetNeedsUpdate"= false,
        "Network"= {}
      }
    },
    "infrastructureEncryption"= {
      "value"= "Disabled"
    }
})

  template_content = <<DEPLOY
{
    "$schema": "http://schema.management.azure.com/schemas/2014-04-01-preview/deploymentTemplate.json#",
    "contentVersion": "1.0.0.0",
    "parameters": {
        "administratorLogin": {
            "type": "string"
        },
        "administratorLoginPassword": {
            "type": "securestring"
        },
        "location": {
            "type": "string"
        },
        "serverName": {
            "type": "string"
        },
        "serverEdition": {
            "type": "string"
        },
        "vCores": {
            "type": "int",
            "defaultValue": 4
        },
        "storageSizeGB": {
            "type": "int"
        },
        "haEnabled": {
            "type": "string",
            "defaultValue": "Disabled"
        },
        "availabilityZone": {
            "type": "string"
        },
        "standbyAvailabilityZone": {
            "type": "string"
        },
        "version": {
            "type": "string"
        },
        "tags": {
            "type": "object",
            "defaultValue": {}
        },
        "firewallRules": {
            "type": "object",
            "defaultValue": {}
        },
        "backupRetentionDays": {
            "type": "int"
        },
        "geoRedundantBackup": {
            "type": "string"
        },
        "vmName": {
            "type": "string",
            "defaultValue": "Standard_B1ms"
        },
        "publicNetworkAccess": {
            "type": "string",
            "metadata": {
                "description": "Value should be either Enabled or Disabled"
            }
        },
        "storageIops": {
            "type": "int"
        },
        "storageAutogrow": {
            "type": "string",
            "defaultValue": "Enabled"
        },
        "vnetData": {
            "type": "object",
            "metadata": {
                "description": "Vnet data is an object which contains all parameters pertaining to vnet and subnet"
            },
            "defaultValue": {
                "virtualNetworkName": "testVnet",
                "subnetName": "testSubnet",
                "virtualNetworkAddressPrefix": "10.0.0.0/16",
                "virtualNetworkResourceGroupName": "[resourceGroup().name]",
                "location": "westus2",
                "subscriptionId": "[subscription().subscriptionId]",
                "subnetProperties": {},
                "isNewVnet": false,
                "subnetNeedsUpdate": false,
                "Network": {}
            }
        },
        "infrastructureEncryption": {
            "type": "string"
        }
    },
    "variables": {
        "api": "2021-05-01-preview",
        "firewallRules": "[parameters('firewallRules').rules]"
    },
    "resources": [
        {
            "apiVersion": "[variables('api')]",
            "location": "[parameters('location')]",
            "name": "[parameters('serverName')]",
            "properties": {
                "version": "[parameters('version')]",
                "administratorLogin": "[parameters('administratorLogin')]",
                "administratorLoginPassword": "[parameters('administratorLoginPassword')]",
                "publicNetworkAccess": "[parameters('publicNetworkAccess')]",
                "Network": "[if(empty(parameters('vnetData').Network), json('null'), parameters('vnetData').Network)]",
                "Storage": {
                    "StorageSizeGB": "[parameters('storageSizeGB')]",
                    "Iops": "[parameters('storageIops')]",
                    "Autogrow": "[parameters('storageAutogrow')]"
                },
                "Backup": {
                    "backupRetentionDays": "[parameters('backupRetentionDays')]",
                    "geoRedundantBackup": "[parameters('geoRedundantBackup')]"
                },
                "availabilityZone": "[parameters('availabilityZone')]",
                "highAvailability": {
                    "mode": "[parameters('haEnabled')]",
                    "standbyAvailabilityZone": "[parameters('standbyAvailabilityZone')]"
                },
                "dataencryption": {
                    "infrastructureEncryption": "[parameters('infrastructureEncryption')]"
                }
            },
            "sku": {
                "name": "[parameters('vmName')]",
                "tier": "[parameters('serverEdition')]",
                "capacity": "[parameters('vCores')]"
            },
            "tags": "[parameters('tags')]",
            "type": "Microsoft.DBforMySQL/flexibleServers"
        },
        {
            "condition": "[greater(length(variables('firewallRules')), 0)]",
            "type": "Microsoft.Resources/deployments",
            "apiVersion": "2019-08-01",
            "name": "[concat('firewallRules-', copyIndex())]",
            "copy": {
                "count": "[if(greater(length(variables('firewallRules')), 0), length(variables('firewallRules')), 1)]",
                "mode": "Serial",
                "name": "firewallRulesIterator"
            }
        }
    ]
}
DEPLOY
  deployment_mode = "Incremental"
}

Output: