Option 1: Reduction of setting time of cement - This option is incorrect. Addition of gypsum actually increases the setting time of cement and does not reduce it. Gypsum is added to control the setting process and prevent rapid setting of cement, allowing for better workability.

Option 2: Production of very light-colored cement - This option is incorrect. Gypsum does not affect the color of cement. The color of cement is primarily determined by the raw materials used in its production.

Option 3: Increase in setting time of cement - This option is correct. Gypsum is added to cement to increase its setting time. This is important because it allows sufficient time for the cement to be mixed, placed, and finished before it starts to harden. This makes it easier for construction workers to handle and work with the cement.

Option 4: Formation of a shining surface - This option is not directly related to the addition of gypsum in cement. The addition of gypsum does not specifically result in the formation of a shining surface. The appearance of the surface of the cement can be influenced by other factors such as the type of finishing applied.

So, the correct answer is option 3. Gypsum is added to cement to increase its setting time, not decrease it.