Consider the following statements regarding the Indian squirrels: 1. They build nests by making burrows in the ground. 2. They store their food materials like nuts and seeds in the ground. 3. They are omnivorous. How many of the above statements are correct?

1. They build nests by making burrows in the ground. This is not generally true for Indian squirrels as a group; common Indian tree squirrels are arboreal and nest in trees, though some squirrel species can use ground burrows. Verdict: Incorrect.

2. They store their food materials like nuts and seeds in the ground. Squirrels are known to cache food in the ground, and UPSC appears to be treating this as a valid general trait of squirrels found in India as well. Verdict: Correct.

3. They are omnivorous. Squirrels eat not only fruits, nuts and seeds but also insects, eggs, and small animal matter. Verdict: Correct.

Hence, two statements are correct. Answer: (b).