The correct answer is: b) Central government grants and transfers.
Arunachal Pradesh is a special category state in India. Special category states are those that are considered to be economically and socially backward. As a result, they receive special financial assistance from the central government. This assistance is in the form of grants and transfers, which are used to fund development projects and social welfare programs.
Market borrowings are loans that a state government takes from the market. These loans are usually used to finance capital expenditure, such as infrastructure projects. Foreign Direct Investment (FDI) is investment that is made by foreign companies in Indian companies. This investment can be in the form of equity or debt. Disinvestment of state-owned enterprises is the sale of government-owned assets to private companies.
All of these options are sources of revenue for state governments, but only central government grants and transfers are a significant source of revenue for Arunachal Pradesh.