The correct answer is option 2, the Palk Strait. The Palk Strait is a narrow stretch of water that separates the southernmost point of India (Rameswaram) from the northernmost point of Sri Lanka (Mannar). This strait is about 80 kilometers long and varies in width from about 16 to 48 kilometers.

Option 1, the Eight Degree Channel, is a separate waterway that lies between the Lakshadweep Islands of India and the Minicoy Island of the Maldives. This channel is located at the eighth degree of latitude north of the equator.

Option 3, the Ten Degree Channel, is another waterway in the Indian Ocean. It is situated between the Andaman and Nicobar Islands of India and the Indonesian Island of Great Nicobar. The channel is found at the tenth degree of latitude north of the equator.

Option 4, the Andaman Sea, is a body of water located east of the Andaman and Nicobar Islands and west of the Malay Peninsula. It is not a specific waterway that separates India from Sri Lanka.

Therefore, the correct answer is option 2, the Palk Strait.