In recent years, the Movement for Global Mental Health (MGMH) and the World Health Organization have worked closely with governments across the global South to redress major treatment gaps to improve access to mental health services. In India, recent reforms include transforming public psychiatric institutions from sites of treatment to research and training institutes, known as "Centres of Excellence," to combat acute manpower shortages and modernize psychiatry. Drawing on ethnographic fieldwork at a public psychiatric hospital in Srinagar, Kashmir, one of the institutions selected to be a future "Centre of Excellence," this article focuses on how these reforms have affected psychiatric institutions themselves. Efforts at modernizing and increasing access to mental health care—that is, emphasizing shortened stays, increasing outpatient treatment, and providing care in the "community"—depend on quarantining stigmatized, chronically ill, long-term patients who reside in custodial conditions with fewer resources and limited attention from providers. Psychiatrists have a radically different vision for redressing manpower shortages than the MGMH and Indian state, revealing contradictions in the reform process. This paper demonstrates how modernizing mental health care splits mental institutions spatially, ontologically, temporally, and epistemologically, so that the process of modernizing the institution is neither seamless nor complete.