The correct option is 2 only
Explanation
Red and Yellow soils develop on crystalline igneous rocks in areas of low rainfall, primarily in the eastern and southern parts of the Deccan Plateau. They are the third-largest soil group in India.
Statement 1 is Incorrect: The characteristic reddish colour of these soils is attributed to the wide diffusion of iron in crystalline and metamorphic rocks. This coloration is a result of oxidation under specific climatic conditions.
Statement 2 is Correct: The soil appears yellow when it occurs in a hydrated form (i.e., when ferric oxide combines with water). Conversely, it appears red when it is anhydrous. Therefore, the soil turns yellow when it gains moisture (hydration), not when it loses it.
Statement 3 is Incorrect: These soils are not confined only to Chhattisgarh and Odisha. They have a widespread distribution, covering large parts of Tamil Nadu, Karnataka, Andhra Pradesh, Maharashtra, and the piedmont zone of the Western Ghats.
Key Takeaway: Red soils derive their colour from iron diffusion in crystalline rocks and appear yellow when hydrated. They cover a significant portion of Peninsular India, extending beyond just the eastern plateau.