In Android Studio 4.0.0 Java 8+ APIs available through desugaring is not working

I downloaded Android Studio 4 and tried to test using Java 8's Streams and so on based on our application settings. Our Sdk version is 17. I updated build.gradle based on this Android Studio 4 release notes and Java 8 Support for android. But I haven't access to Java 8 features as Stream, StreamSupport or Collections.stream(). I wonder what I am missing here. I have created a basic project with Android Studio template. The Project's build gradle looks like this:

// Top-level build file where you can add configuration options common to all sub-projects/modules.
buildscript {
    repositories {
        google()
        jcenter()
    }
    dependencies {
        classpath "com.android.tools.build:gradle:4.0.0"

        // NOTE: Do not place your application dependencies here; they belong
        // in the individual module build.gradle files
    }
}

allprojects {
    repositories {
        google()
        jcenter()
    }
}

task clean(type: Delete) {
    delete rootProject.buildDir
}

and the modules build.gradle looks like this:

apply plugin: 'com.android.application'

android {

    compileSdkVersion 17
    compileOptions {
        // Flag to enable support for the new language APIs
        coreLibraryDesugaringEnabled true
        // Sets Java compatibility to Java 8
        sourceCompatibility JavaVersion.VERSION_1_8
        targetCompatibility JavaVersion.VERSION_1_8
    }


    defaultConfig {
        applicationId "com.example.myapplication"
        minSdkVersion 17
        targetSdkVersion 17
        versionCode 1
        versionName "1.0"
        multiDexEnabled true

        testInstrumentationRunner "androidx.test.runner.AndroidJUnitRunner"
    }

    buildTypes {
        release {
            minifyEnabled false
            proguardFiles getDefaultProguardFile('proguard-android-optimize.txt'), 'proguard-rules.pro'
        }
    }
}

dependencies {
    implementation fileTree(dir: "libs", include: ["*.jar"])
    implementation 'androidx.appcompat:appcompat:1.1.0'
    implementation 'com.google.android.material:material:1.0.0'
    implementation 'androidx.constraintlayout:constraintlayout:1.1.3'
    implementation 'androidx.navigation:navigation-fragment:2.1.0'
    implementation 'androidx.navigation:navigation-ui:2.1.0'
    testImplementation 'junit:junit:4.12'
    androidTestImplementation 'androidx.test.ext:junit:1.1.1'
    androidTestImplementation 'androidx.test.espresso:espresso-core:3.2.0'
    coreLibraryDesugaring 'com.android.tools:desugar_jdk_libs:1.0.5'
}

And this is the gradle.properties:

android.useAndroidX=true
org.gradle.jvmargs=-Xmx2048m
android.enableJetifier=true