Consider the following statements about India's exchange rate indices:

1. A rise in the Nominal Effective Exchange Rate (NEER) indicates an appreciation of the rupee against a basket of currencies.

2. A rise in the Real Effective Exchange Rate (REER) indicates an improvement in India's trade competitiveness.

3. Higher domestic inflation relative to trading partners widens the gap between the NEER and the REER.

How many of the statements given above are correct?