The correct answer is option 'A' - The independence of judiciary is safeguarded. This feature indicates that Indian policy is federal in character. Let's explore why this is the case:

1. Definition of Federalism:
Federalism is a system of government where powers and functions are divided between a central authority and various constituent units. In a federal system, the independence of the judiciary is a crucial feature that ensures a proper balance of power between the central government and the constituent units.

2. Significance of an Independent Judiciary:
An independent judiciary acts as a check on the powers of the executive and legislative branches. It ensures that the government functions within the limits of the constitution and upholds the rule of law. In a federal system, an independent judiciary helps resolve disputes between the central government and the constituent units, thereby maintaining the federal character of the system.

3. Judicial Review:
One of the essential functions of an independent judiciary is to exercise judicial review. In India, the judiciary has the power to interpret the constitution and determine the validity of laws and actions of the government. This power of judicial review helps protect the rights and interests of both the central government and the constituent units, ensuring the federal nature of Indian policy.

4. Role of Judiciary in Interpreting Federal Provisions:
In a federal system, there are often disputes regarding the distribution of powers between the central government and the constituent units. The judiciary plays a crucial role in resolving these disputes by interpreting the federal provisions of the constitution. By ensuring that the powers of the central government and the constituent units are maintained as intended by the constitution, the judiciary upholds the federal character of Indian policy.

5. Safeguarding Fundamental Rights:
An independent judiciary is essential for safeguarding the fundamental rights of citizens. In India, the Fundamental Rights are enforceable by the Courts of Law. The judiciary acts as a protector and interpreter of these rights, ensuring that they are not violated by any authority, including the central government. This reinforces the federal nature of Indian policy by providing a mechanism to protect the rights of citizens across the country.

In conclusion, the independence of the judiciary is an essential feature in Indian policy that indicates its federal character. An independent judiciary acts as a check on the powers of the central government, interprets federal provisions, resolves disputes between the central government and the constituent units, and safeguards the fundamental rights of citizens.