The correct answer is: A) They retained internal control but ceded foreign affairs.
A subsidiary alliance was a treaty between the British East India Company and a princely state in India. Under the terms of the treaty, the princely state agreed to cede control of its foreign affairs to the British, while retaining control of its internal affairs. The British would provide military protection to the princely state in return for its loyalty.
The subsidiary alliance system was established in the late 18th century by the British East India Company in order to consolidate its control over India. The system was successful in preventing the princely states from uniting against the British, and it allowed the British to control the foreign affairs of the princely states without having to directly administer them.
The subsidiary alliance system came to an end in 1947, when India gained independence from British rule. The princely states were then given the choice of joining either India or Pakistan. Most of the princely states in Telangana joined India.
Option B is incorrect because the princely states retained internal control. Option C is incorrect because the princely states did not gain complete independence. Option D is incorrect because the princely states did cede control of foreign affairs.