There are more than forty newspapers published in the cities of Kerala, a state on the Malabar Coast, which reflects the fact that Keralans are by far India’s most literate citizens.
(A) which reflects
(B) and that number reflects
(C) which reflect
(D) that number reflects
(E) that reflects
A C and E are ambiguous. They don't clearly tell us whether they are referring to the Coast or the number, thus, cross them out.
B and D left
That can not be used with comma ","
SO, B is my choice, "and" is necessary to maintain the structure and the meaning of the sentence.