The correct answer is option 2 - Distribution of power between the Union and the States.

The Seventh Schedule of the Constitution of India is a key part of the country`s federal structure. It divides the powers and responsibilities between the central government (Union) and the state governments. The schedule consists of three lists: the Union List, the State List, and the Concurrent List.

The Union List contains subjects on which only the central government has the authority to make laws. The State List contains subjects on which only the state governments have the authority. The Concurrent List contains subjects where both the central and state governments have the authority to make laws.

The distribution of powers in the Seventh Schedule helps maintain a proper balance between the central government and the state governments, ensuring that each level of government has the necessary authority to govern effectively.