Correct Answer: He exclaimed that he would have really loved to visit Kashmir that year.

Solution : The first option is correct.

Explanation:
Indirect form, also known as indirect speech or reported speech, is a way of expressing someone else's words or statements without quoting them directly. The reporting verb said changes to exclaimed.
Narration conversion:

• The reporting "said" changes to "exclaimed that".
• The first person pronoun "I" changes to the third person pronoun.
• "This year" becomes "that year" in the indirect part.

Therefore, the indirect form would be: H e exclaimed that he would have really loved to visit Kashmir that year .