Indian Prime Minister Narendra Modi’s Bharatiya Janata Party agreed to a surprise alliance with the rival Nationalist Congress Party to form the government in the western state of Maharahstra, home to the country’s financial capital, Mumbai.

Modi tweeted his congratulations to BJP’s Devendra Fadnavis, who was sworn in as chief minister of the state. Ajit Pawar of the NCP, which until yesterday was in talks with the BJP’s estranged ally Shiv Sena over an alliance, was named deputy chief minister.

Following assembly elections in Maharashtra in October, the BJP, which emerged as the single largest party, was expected to rule the state for a second time with partner Shiv Sena. A sticking point between the parties, however, was Shiv Sena chief Uddhav Thackeray’s demand that the chief minister’s post be shared on a rotational basis — a request the the BJP denied amida bitter fortnight of political infighting.

Shive Sena broke ranks with its bigger partner and started discussions with Sonia Gandhi’s Congress party and the NCP to stitch together a coalition government. The central government imposed so-called President’s rule while discussions were ongoing among the parties.

Maharashtra capital Mumbai, a city of 18 million people, is home to companies such as Reliance Industries Ltd. and Tata Group, India’s two main stock markets, and the country’s film industry. It’s also home to some of India’s biggest slums. Control of the nation’s second-most populous state would help Modi implement his push to attract foreign investment and revitalize the nation’s manufacturing base and revive the slowing economy.

Minutes after the announcement that new government had been formed, NCP chief Sharad Pawar tweeted that the decision by his nephew, Ajit, to join hands with the BJP was his personally and didn’t have the support of the party.

Six months after winning a landslide victory in federal elections, Modi faced tougher-than-expected battles to retain power in Maharashtra and the northern state of Haryana. In Haryana, the BJP formed the government with the help of a regional party.