Explanation

Kerala, Punjab and Maharashtra topped the Indian states on the Human Development Index around 2011–12, leading on literacy, life expectancy and income indicators, and were placed above China in the comparison underlying this question. The other sets include lower-HDI states such as Madhya Pradesh and Gujarat. UPSC's official key marks B; note that under the UNDP HDR 2011 and India HDR 2011 figures most commonly cited (China ≈ 0.687; Punjab ≈ 0.605, Maharashtra ≈ 0.572), only Kerala unambiguously exceeded China, so the keyed answer appears to rest on a different dataset.