The status quo agreement was separate from the accession instrument formulated at about the same time by the Department of States, which was a legal document including a transfer of sovereignty to the extent defined in the instrument.  A status quo agreement was an agreement signed between the newly independent lords of India and Pakistan and the princely states of the British-Indian Empire before their integration into the new reigns. The form of the agreement was bilateral between a government and a spring state. It provided that all administrative agreements between the British crown and the State would remain unchanged between the signatory regime (India or Pakistan) and the spring state until new agreements were concluded.  Both draft treaties were submitted to the House of Princes on July 25. A state negotiating committee was formed, which reviewed the two agreements, consisting of ten leaders and twelve ministers. After discussion, the Committee finalized the two draft agreements on 31 July.  On 15 August, the State of Junagadh implemented the accession instrument and the status quo agreement with Pakistan. It was adopted by Pakistan on 13 September.  Junagadh was the only state to declare membership in Pakistan until 15 August.  It is significant that the agreement did not provide for the Dominion of India to deploy Indian troops to the state, while British India had maintained several cantons, notably in Secunderabad, as part of its “subsidiary alliance” with the state. Over the next six months, Indian troops were withdrawn from the state.
 The State of Jammu and Kashmir, bordering India and Pakistan, has decided to remain independent. She offered to sign status quo agreements with both gentlemen. Pakistan immediately agreed, but India called for further talks. According to K.M Munshi, appointed India`s general agent in Hyderabad, the Indians felt that the conclusion of a status quo agreement with Hyderabad meant that India had lost control of Hyderabad`s affairs. The Hyderabad State Congress opposed it because it was seen by the Indian government as a sign of weakness.  V. P. Menon stated that Nizam and his advisers viewed the agreement as a respite from which Indian troops would be withdrawn and the state could establish its position to maintain its independence.  The draft status quo agreement was drawn up on 3 June 1947 by the political department of the British-Indian government. The agreement provided that all administrative agreements of “common interest” between the British Crown and a particular signatory state would be kept unchanged between the signatory regime (India or Pakistan) and the State until new agreements are concluded. A separate timetable set out issues of common interest.
During the discussion, Jawaharlal Nehru, India`s future prime minister, expressed doubts about whether the agreement should cover only “administrative” issues. Mohammad Ali Jinnah, the future Governor General of Pakistan, spoke in his favour.  The new delegation obtained only trivial changes to the previous draft agreement.  It established that all subsequent agreements and administrative arrangements between the British Crown and Nizam would be maintained with the Indian government.