The use of 'diminishing' is incorrect as a base form of the verb is required to be used after a modal verb. 'Insidious' means spreading gradually or without being noticed but causing serious harm. So, it shows the negative effects of land acknowledgement, therefore, 'undermine' will be the right verb to describe this.
Hence, option (d) is correct.
NOTE/-
Modal verb: A verb used with another verb to express an idea such as possibility that is not expressed by the main verb. The modal verbs in English are "can," "could," "may," "might," "must," "ought," "shall," "should," "will," and "would." They do not change their form (spelling) and they have no infinitive or participle (past/present). Example: I can speak Spanish. Here 'can' expresses the ability of the person to speak (main verb) Spanish. This ability cannot be expressed by the main verb 'speak'.
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