Two years after taking charge of India's federal government in New Delhi with a resounding mandate, Mr Narendra Modi's Bharatiya Janata Party (BJP) government can look into the future with greater confidence thanks to its strong showing in a string of provincial polls, results to which were announced on May 19. Its main rival, the Congress Party, is finding itself increasingly pushed out of the political map of the country.

Congress lost two major states in the latest round - it ceded Assam in the remote north-east to the BJP and Kerala in the deep south to a left front dominated by the Marxists.

It is the Assam victory the BJP is excited about as it enables it to lay claim to have emerged as a truly national party. Previously, it had captured power only in central, western and northern India and will now be placing renewed energy on raising its influence in southern India. Aside from Assam, it has under its belt Maharashtra, Gujarat, Madhya Pradesh, Chhatisgarh, Punjab, Haryana, Rajasthan, and Jammu and Kashmir.

The Congress is left with only slices of India to rule over - Karnataka in the south and a few small states in the north and in the north-east. The sense of marginalisation in the states adds to its dismal showing in the 2014 parliamentary polls, where it won only 44 seats in the 545-member Lower House - its worst showing on record.

While the BJP is in celebratory mode, and looks better positioned now to pursue its legislative and economic agenda, the Congress and its leaders, Mrs Sonia Gandhi and her son Rahul, have thrown up few new ideas on how they intend to recover the ground lost to the BJP and regional parties.

In its moment of triumph, the BJP can indeed have the satisfaction of having pushed Congress into corners of the country. That said, not all is hunky-dory for it. For instance, it has no ready response to the domination of powerful regional leaders like Ms Mamata Banerjee in West Bengal and Ms J. Jayalalithaa in Tamil Nadu have acquired in these key states.

The BJP, which came to power in May 2014 with a clear majority, ceded the populous northern state of Bihar in state polls last year. In this month's state elections, Ms Banerjee stormed back into power in West Bengal in a big way as did Ms Jayalalithaa in Tamil Nadu.

In Kerala, where control of the state has alternated between Congress-led and Marxist-led fronts, the left front replaced the Congress-led front. That said, the BJP got its first success in the state with one legislator elected to the assembly on its party ticket.

What lies ahead? Much will depend on what kind of relations the federal BJP government would like to have with the states controlled by regional groupings and powerful local leaders.

It has been talking about "cooperative federalism" but it has been fairly aggressive against some Congress-controlled states like Arunachal Pradesh and Uttarakhand, attempting to replace their governments by imposing federal rule - only to invoke the Supreme Court's wrath.

Dealing with states like Bihar, West Bengal and Tamil Nadu will, however, require sensitivity and sophistication and respect for local sentiments. Congress, in its heyday, had burnt its fingers in some questionable ventures guided from New Delhi by stretching the Constitution provisions here and there to impose federal rule.

Immediately, the election results will help the federal government push the pending GST Bill, which essentially tends to create a common market within India with an easier inter-state trading regime. Both Ms Banerjee and Ms Jayalalithaa are inclined to support the Bill. The Congress Party's attempts to block the Bill are likely to get blunted in case some regional parties choose to back it in the Upper House, where the measure is stuck amid the political recriminations between the Congress and BJP. The GST Bill, when passed by Parliament, possibly, in the year ahead, will send a positive signal to India Inc as well as foreign companies. This would help give a push to Mr Modi's "Make-in-India" plans.

Heading towards the halfway point of his five-year term, many more steps, however, are needed to enable the economy to achieve 8 per cent growth rate, particularly to create more jobs for the 15 million that enter the workforce every year. Sluggish progress in job creation is politically risky, even if the wind at the moment is blowing the BJP way.

Of crucial importance will be next year's provincial elections in key states such as Uttar Pradesh, Gujarat and Punjab. Together, they send one-fifth of MPs to the Lower House of 545 members.

Uttar Pradesh will be most crucial and is where Mr Mulayam Singh's Samajwadi (Socialist) Party rules. Another regional group - Ms Mayawati's Bahujan Samaj Party - is eyeing its chances of seizing power in the nation's largest state. The BJP had won as many as 73 out of 80 seats in the previous parliamentary elections. However, it simply does not seem possible that it can translate that massive showing into a victory in the state assembly elections.

Unless the Congress re-invents itself, the next parliamentary election in 2019 will essentially be a fight between the BJP on one side and an agglomeration of regional parties on the other. Deciding who will lead a joint regional front won't be easy, given the rival ambitions at play.

Mr Nitish Kumar, the chief minister of Bihar, has made it known that he would like to play a national role. Ms Banerjee, who is now entrenched in West Bengal, may eye a national role now. She will closely watch developments within the Congress Party, to which she belonged before starting her own party, to see whether its rank and file would flock to her in case the Congress falls apart or becomes a rump.

The crisis in which the Congress Party has now landed is perhaps the worst in its post-Independence history, and its leadership is not sure how to handle it. The inertia that has gripped it is dangerous for its future at a time when its main foe, the BJP, is set on working for "a Congress-free India".

•The writer is a former editor of The Hindustan Times, Indian Express, Times of India and The Tribune. He is currently adviser to Observer Research Forum, a New Delhi think-tank.