KP refers to the closeness of 2 or more of your main keywords. The closer they are together, the more relevance Google will award to them and the better will be your ranking potential for those keywords.

It helps enhancing relevancy to your page. The use of exact keyphrase will give a webpage more relevancy than other as its repetition through out the webpage.

Keywords proximity means how close two keywords are. Closeness between two keywords is termed as keywords proximity.

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How close keywords are to each other on web pages.

Keyword proximity is a measure to get idea about the closness between two or more keywords in a keyword phrase.

For example
search engine rankings
ranking in search engines

if someone search engine rankings then page contenting 1st phrase will on top in comparison to 2nd due to proximity.