Option 1: Paper and Pulp industry. This industry is known to consume a significant amount of water during the manufacturing process. However, it is not the maximum consumer of water in India.
Option 2: Thermal Power industry. The correct answer. The thermal power industry requires a large amount of water for cooling purposes in power plants. This industry is known to be the maximum consumer of water in India.
Option 3: Engineering industry. While the engineering industry may require water for various processes, it is not the maximum consumer of water in India.
Option 4: Textile industry. The textile industry also requires water for various processes like dyeing, washing, and finishing. However, it is not the maximum consumer of water in India.
In conclusion, the thermal power industry is the maximum consumer of water in India, making option 2 the correct answer.