Is unity in diversity just a slogan given the numerous regional strifes all over the nation? Or are the troubles exaggerated by our constant connection to the news?

I'd like it to be, though I doubt it. While breaking up into several countries is extreme (though not foreseeable), maybe a federation of smaller countries to represent them as India might work. I think we've gone past unity in diversity stage. Our diversity is in fact our biggest weakness and nothing more than a checkmark on our tourism brochure. We need to go beyond "but India just works in spite of it!" argument as well, because the fact is, it works, just barely enough to make that statement.

I go back and forth on this. First thought is to keep intact and tough it out, but that doesn't seem like a healthy situation. There is too much ethnic strife and the center is far too disconnected to effectively govern this side. Another extreme option is to break up into 3-4 smaller countries: the more prosperous south and western states, the populous and agrarian north and middle, the leftist east (mainland) and finally, the remote north east.
What I think will ultimately end up happening is that India will slowly and surely lose all of Kashmir and large chunks of the North Eastern states and will stay a fractured republic.

I think the first question, instead of 'will it' should be, should it be' disparate regions. One line of argument suggests that before the British, India existed perhaps as a concept (including Pakistan) until the British and later to a greater degree Vallabhbhai Patel helped unify these regions to form a nation-state. What would be the condition if that merger hadn't happened? Like this article suggests, partition was perhaps a good thing

Hard to speculate on what India would've looked like without Patel's unification drive, perhaps a series of state-countries ala Madras (south), Bombay (west) and a series of princely fiefdoms like Hyderabad and Gwalior, not unlike Europe, albeit more third-world.

Without unification, perhaps regions would've voluntarily coalesced to form nations if it suited their economic and social necessities. If not, the Madras and Bombay Presidencies were still larger geographical entities than most nations in Europe and imagine if they had chosen to liberalize sooner than 1991 instead of languishing under socialism until 1991.

The next question is, what do these economically prosperous regions gain from its neighbors? Culture? Human capital? Would Bombay be what is without people from Sindh, UP, Bihar, South India, etc.? Would restrictive immigration policies if enforced by the Shiv Sena in the 60s spelled doom for Bombay's economic future?

Yes India will will exist as a nation-state 100 years down the lane without any doubt. Imagining that India could probably divided in to smaller countries mainly north, east, south and west at this point of time is not convincing. The reason is 2014 general elections will be remembered as the most significant in the history of Indian democracy. At this point of time there is a chaos in India in every front. Politics, Media, Religious fundamentals, Naxals, Defence, Economy, Social unrest, crime against women and what not. Everything looks unstable and its would be unfair to blame the politicians or the Govt. at the center. Every one of us (Indians) are responsible for what's happening....

... Both educated and uneducated class are responsible for this situation. This gives us a clear picture that India and its states are not stable yet. I mean there is a lot in every state that needs stability and once states are stable India as a country is stable. I don't think that Indian and its states would be stable so soon. It will take years rather decades. Also I'm pretty sure that majority of Indians would love to see India as it is not and no one would be product of their own state like country. This might happen after a 1000 years but not in near future....

....Saying that I would like to second Dr. Sashi Tharoor's thought. What India needs is a change in political structure. It seems like India is on the verge of getting in to Presidential Form of Government which sounds apt in this present scenario of Indian political with respect to various kinds of unrest. So smaller countries is a distant dream, federal structure has high possibility and even after a 100 years people will still find India on the world map.