Step 1: Understanding the Concept:
The task is to arrange four prominent Indian English novels based on their release dates, from the oldest to the newest.
Step 2: Detailed Explanation:
Determining the publication year of each novel:
\[\begin{array}{rl} \bullet & \text{(C) Swami and Friends by R. K. Narayan: 1935. Narayan's first novel.} \\ \bullet & \text{(B) The Guide by R. K. Narayan: 1958. A renowned later novel by Narayan.} \\ \bullet & \text{(D) The Shadow Lines by Amitav Ghosh: 1988. An important post-independence novel.} \\ \bullet & \text{(A) The Inheritance of Loss by Kiran Desai: 2006. A 21st-century Booker Prize winner.} \\ \end{array}\]Therefore, the chronological order is: (C) $\rightarrow$ (B) $\rightarrow$ (D) $\rightarrow$ (A).
Step 3: Final Answer:
The correct answer is (D).