Since the Sheraton Move in 2020 which led to the fall of the Malaysian government, many state governments in the federation have held their elections separately from the central government. This has resulted in a dynamic political situation in which coalitions have been formed in different ways at different times in different states. At present, there are seven states ruled by the Pakatan Harapan - Barisan Nasional (PHBN) grand coalition, while four states are under the Perikatan Nasional (PN) coalition. States have increasingly demanded greater political and policy autonomy over the last few years, particularly in the area of fiscal revenue-sharing between the federal and state governments. Progress has been most forthcoming for issues related to the East Malaysian states of Sabah and Sarawak, and the federal government's newly set-up Malaysia Agreement 1963 Implementation Action Council has been meeting regularly. Contentious state-federal issues remain for states apart from Sabah and Sarawak, to which the federal government has not seriously responded. Limited space exists for formal state-federal negotiations that can result in firm decisions.

Sabah will be holding its state election in 2025, followed by Sarawak and Malacca in 2026. Pressure will continue to build up as these timelines draw near, and the federal government will need to identify better federal-state negotiation platforms than are currently available.