The principles of Panchsheel are a set of five principles governing relations between States. These principles were based on the assumption that newly independent States, after decolonization, would be able to develop a new and more principled approach to international relations. The first formal codification of these principles in treaty form was done in an agreement between China and India.

Option 1 states that the correct answer is 1 and 2 only. This option is incorrect because it does not include option 3, which states that the first formal codification in treaty form was done between China and India.

Option 2 states that the correct answer is 2 and 3 only. This option is also incorrect because it does not include option 1, which states that the principles of Panchsheel are a set of five principles governing relations between States.

Option 3 states that the correct answer is 1, 2, and 3. This is the correct answer as it includes all the given statements about the principles of Panchsheel.

Option 4 states that the correct answer is 1 and 3 only. This option is incorrect because it does not include option 2, which states that the assumption of Panchsheel was that newly independent States would develop