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The correct answer to the question is option 2, Assam. This means that India`s largest island lake is located in the state of Assam. To better understand this, let`s analyze the other options.
Option 1, Andhra Pradesh, is not the correct answer. Andhra Pradesh is a state in southern India and does not have the largest island lake.
Option 3, Madhya Pradesh, is also not the correct answer. Madhya Pradesh is a central Indian state and does not have the largest island lake.
Option 4, Orissa, is not the correct answer as well. Orissa, currently known as Odisha, is a state located on the eastern coast of India and does not have the largest island lake.
Therefore, the correct answer remains option 2, Assam. Assam, a northeastern state in India, is home to India`s largest island lake.
It is important to note that if we find any inconsistencies or errors in the provided answer, we should mention them. However, in this case, the provided answer seems to be correct.