Effective literacy rates in India are calculated based on the population above 7 years of age. This option ensures that the literacy rates are determined for individuals who are old enough to attend school and have the opportunity to acquire basic reading and writing skills.

Option 1, which includes the total population, might overstate the literacy rates as it includes individuals below the age of 7 who might not have had the opportunity to develop literacy skills yet.

Option 2, which considers only the child population, would underestimate the literacy rates as it excludes adults who may have acquired literacy skills later in life.

Option 3, which focuses solely on the adult population, would also underestimate the literacy rates as it omits children who may have developed basic reading and writing abilities.

Therefore, option 4 is the most appropriate choice, as it considers the population above 7 years of age, ensuring that the data reflects the literacy rates of individuals who have had the opportunity to acquire literacy skills.