Option 1 states that the "Look East" policy is a vital part of the India-China relationship. The Look East policy refers to India`s efforts to strengthen its engagement with countries in East Asia, including China. This statement is correct as the Look East policy has played a significant role in shaping India-China relations.
Option 2 states that there is an active defense exchange program between India and China. This statement is also correct as there have been various defense exchanges and joint military exercises between the two countries in recent years.
Option 3 states that there is an institutional mechanism in place to share international waters between India and China. This statement is correct as India and China have established mechanisms such as the Working Mechanism for Consultation and Coordination on India-China Border Affairs to address border disputes and maintain peace and tranquility along their shared borders.
Therefore, option 4 is the correct answer as all three statements are correct. India-China relations involve the Look East policy, an active defense exchange program, and an institutional mechanism to share international waters.