Interconnect capacitance refers to the capacitance between the interconnect lines in an integrated circuit. It is an important parameter that affects the overall performance of the circuit, especially at high frequencies.

The correct answer to the given question is option 'B', which states that the interconnect capacitance is formed by the interconnect lines between the gates. This means that the capacitance is primarily due to the proximity of the metal lines used for interconnection between different components or gates in the circuit.

The interconnect capacitance can be further explained as follows:

Interconnect Lines:
The interconnect lines are typically made of metal (such as aluminum or copper) and are used to connect various components, such as transistors, capacitors, and resistors, in an integrated circuit. These lines are patterned on the semiconductor substrate and are insulated from each other by a dielectric material (typically silicon dioxide).

Formation of Capacitance:
The capacitance between two parallel interconnect lines is formed due to the electric field between them. When a voltage is applied to one of the lines, it creates an electric field that extends into the neighboring line. This electric field induces an opposite charge on the neighboring line, resulting in a capacitance between the two lines.

Factors Affecting Capacitance:
The magnitude of interconnect capacitance depends on several factors, including:
1. The distance between the interconnect lines: The closer the lines are, the higher the capacitance.
2. The length and width of the interconnect lines: Longer and narrower lines have higher capacitance.
3. The dielectric constant of the insulating material: A higher dielectric constant increases the capacitance.
4. The frequency of operation: The capacitance has a significant impact on circuit performance at high frequencies.

Importance of Interconnect Capacitance:
Interconnect capacitance affects the overall performance of the circuit in several ways:
1. Delay: The capacitance slows down the signal propagation through the interconnect lines, leading to delay in signal transmission.
2. Power consumption: The charging and discharging of the interconnect capacitance require energy, contributing to power consumption.
3. Crosstalk: The capacitance between adjacent interconnect lines can cause unwanted coupling of signals, leading to crosstalk and signal integrity issues.

Conclusion:
In summary, the interconnect capacitance in an integrated circuit is primarily formed by the interconnect lines between the gates. It arises due to the proximity of the metal lines used for interconnection. Understanding and managing this capacitance is crucial for designing high-performance and reliable integrated circuits.