On the eve of their departure, the British government announced that its paramountcy would lapse not only over the British territory but even over the native States . This meant that as many as 625 small and big native States would become independent like India and Pakistan. Consequently, the country would be divided into a number of small and big units.  

Before embarking on this mammoth task, Sardar sought to ensure the stability of administration by forging a bridge of faith and confidence with the "Steel Frame". Most of the I.C.S. officers suspected that the Congress leaders, particularly Sardar in view of his past experiences with them, would have no faith in the I.C.S. But Sardar rose to the occasion and reposed total trust in their capability to serve the nation. He was, thus, able to win their unstinted support in the endeavour of nation building.  

Attempts were afoot for finalising the standstill agreement with the States. It provided that the Central Government will be vested with powers of defence, foreign policy and communications even over the States. Travancore, Hyderabad and some other States declared themselves sovereign States and created hurdles in the agreement. On the other end, Jinnah with a view to tempt Jodhpur, Jaisalmer and other border States made them an unconditional offer to align with Pakistan on their terms.

To find an amicable solution to this complicated situation, Sardar issued a statement to the princes wherein he appealed to their sense of patriotism and reiterated that the new States department in no way, desire to have supremacy over them. "If at all, any sense of supremacy is required, it would be with common understanding and for common good. We are at a momentous stage in the history of India. By common endeavour, we can raise the country to new greatness, while lack of unity will expose us to unexpected calamities. I hope the Indian States will realise fully that if we do not cooperate and work together in the general interest, anarchy and chaos will overwhelm us all great and small, and lead us to total ruin". The statement which amply reflected his statesmanship and political sagacity, removed whatever doubts lurked in the minds of the princes.

There was a popular agitation in Travancore and the State acceded to India. The Nawab of Bhopal could not take all this but when he realised that there was no alternative; he sent the instrument of accession duly signed to Sardar.  

A man of iron will and absolute fearlessness, Sardar Patel tackled the question of 550 and odd State territories and principalities in such a strategic manner which left even his wildest critics in complete amazement. Almost within a year he redrew the map of India with every princely State joining the Indian union and thus, forming part of the political stream of life that was endowed with cultural unity and harmony.

The intricacy of the situation can perhaps be gauged by the fact that there were 26 small States in Orissa and 15 in the Chattisgarh area of present Madhya Pradesh. It required skilful diplomacy on the part of Sardar Patel to persuade them to merge into bigger, more viable units. Even more ticklish was the case of Saurashtra where there were 14 big States, 119 small States and other units under different administrations totalling 860.  

The herculean task of merging all of them into the Saurashtra union was also accomplished by Sardar Patel. Soon, State after State started acceding to the Indian Union. One after the other, Gwalior, Indore, Dhar, Dewas all accepted the advice of Sardar. Rajputana States followed the same. The Sikhs of Punjab also cooperated with the merger.  

Even by August 15, Hyderabad kept aloof. Hence, Lord Mountbatten himself started negotiations. At one stage, it appeared that there was a settlement but Nizam found himself helpless against the pressures of Razakars. The Razakars started harassing the local public.

Thus, when the situation went out of control, Sardar with the consent of the Governor General initiated police action. In 108 hours, the Nizam surrendered and Hyderabad acceded and merged with India. The Nawab of Junagadh accepted an accession with Pakistan. Sardar solved this complex problem in his own inimitable way and the Nawab and his Diwan left Junagadh for Pakistan.  Thus, the idea for establishment of a united India undertaken by Sardar was completed with the merger of Hyderabad. Politically, India became one and united. In the history of India stretched over ages, India became one and united for the first time and that too without shedding a drop of blood. That was the marvel of the personality of Sardar. The sterling qualities of leadership he had shown as leader of Satyagraha, flowered in greater way in the administration of the country, maintenance of law and order and ensuring stability of the country and making it invulnerable.