Special Provisions
While a National Emergency is in operation: (a) the Union's executive power extends to directing any State on how to exercise its own executive power; (b) Parliament's law-making power extends to conferring powers/duties on the Union even on matters not in the Union List - and if the Emergency is only regional, these expanded Union powers also extend to other states if their security is threatened by the emergency-affected region's activities.
This is what actually happens once a National Emergency is declared: the normal federal balance shifts dramatically toward the Union - the central government can direct any state's executive actions, and Parliament can legislate on subjects normally reserved for states, temporarily converting India's federal structure into something closer to a unitary one for the Emergency's duration.
During a declared National Emergency, the Union government gains the power to directly instruct state governments on how to exercise their own executive functions - a level of central control over states that doesn't exist during normal times.