The correct option is C
Only statement 1 is correct.
Magnetic property possessed by a magnetic substance due to the presence of a magnet near it, is called magnetic induction.
When a steel safety pin is brought close to one pole of a bar magnet it gets attached to the magnet. Now when an alpin is touched to the safety pin, the safety pin behave as a magnet and attracts the alpin. This happens due to magnetic induction.
So, statement 1 is correct.
But, magnetic induction does not take place in non magnetic material also non magnetic materials cannot be magnetised.
So, statement 2 is incorrect.