The Home Ministry has issued an advisory to all states and asked the Intelligence Bureau to assess the authenticity of the 55-minute video, in which Zawahiri described the formation of the "Al Qaeda in the Indian Subcontinent" as glad tidings for Muslims "in Burma, Bangladesh, Assam, Gujarat, Ahmedabad, and Kashmir" and said the new wing would "rescue Muslims there from injustice and oppression."
Intelligence sources said the move was not unexpected, with the Al Qaeda losing ground to the Islamic State or ISIS which is now challenging it for leadership of transnational Islamist militancy. (Home Ministry Alert for States after Al Qaeda Announces Indian Wing in Video)
Sources say the mention of places like Assam, Gujarat, Ahmedabad and Burma - which are communally sensitive - is designed to attract radicalised youth, who are now being drawn to the ISIS.
The ISIS, a breakaway faction of the Al Qaeda, has galvanized young followers around the world by carving out tracts of territory across the Iraq-Syria border. Al Qaeda affiliates are in direct military confrontation with the ISIS in Syria.
Islamic State leader Abu Abu Bakr al-Baghdadi calls himself a "caliph" or head of state and has demanded the loyalty of all Muslims.
The group fell out with Zawahri in 2013 over its expansion into Syria, where Baghdadi's followers have carried out beheadings, crucifixions, and mass executions.
Zawahiri says in his message that the new unit in the Indian sub-continent will "crush the artificial borders" dividing Muslim populations in the region. He has called for unity among militants and criticised "discord" - echoing a common al Qaeda complaint against Islamic State's record of clashing with rival Islamist groups in Syria.
While the Al Qaeda is very much at home in the Afghanistan-Pakistan border area, due to influential contacts and a long presence there, it is a minnow compared to local militant groups in terms of manpower and regional knowledge.
Zawahiri's statement has warned Al Qaeda's new wing against oppressing local populations - a complaint leveled against the Islamic State by critics in Iraq and Syria.
Al Zawahiri took over as Al Qaeda's head after founder Osama Bin Laden was killed in May 2011 in Pakistan in a US operation.
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