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The nation's "coming into being" as a system of cultural signification, as the representation of social life rather than the discipline of social polity, emphasizes this instability of knowledge.
In this statement, Bhabha is talking about how a nation is defined by culture and actual social life, and many different ways of living, rather than the study (discipline) of an organized government and/or constitution (polity). Thus, the knowledge of what a nation is is unstable or not totally understood.
Bhabha cites Michael Oakeschott as calling the modern nation "equivocal" -- meaning having multiple interpretations (literally, many equal voices). Bhabha adds that a modern nation is ambivalent (having mixed feelings or contradictory ideas) because it is a product of these different ideas, represented as "societies." Being a product of multiple societies opposes the idea of a single, national idea with a common purpose.
For Bhabha, a nation is not just a singular entity comprising a single purpose; a nation is also a product of multiple societies, multiple ways of living. In this book, Bhabha examines this idea of a liminal (in transition) nation, one that is changing as a complex of multiple perspectives. (This is in contrast of the idea of a nation defined by one singular idea of itself.)
In the book, Bhabha proposes to look at how multiple perspectives form "narratives." Narratives can refer simply to stories, but in this context, he is particularly talking about narratives of a nation. For instance, American narratives are things like Manifest Destiny, the self-made man/woman, freedom via democracy, and so on. But such narratives also include social class struggles, racism, sexuality, the system of laws ("langue") and the speaking power of each individual ("parole").
In short, Bhabha's project is to recognize and utilize multiculturalism in order to challenge the idea that a nation's people are a single, assimilated concept:
It is a much more substantial intervention into those justifications of modernity - progress, homogeneity (making everything/everyone the same), cultural organicism, the deep nation, the long past - that rationalize the authoritarian, "normalizing" tendencies within cultures in the name of the national interest...
Bhabha's book criticizes the idea that a nation is a homogeneous thing.
Looking at a nation as a series of competing stories (narratives), we stop thinking of the nation as defined by a majority or a small minority rule. This study also lends itself to consider national identities as products of international (between two or more nations) interaction. For example, Mexican-Americans have cultural narratives which are formed of two different nations and are a part of both. This is why Bhabha speaks of margins and borders: he understands culture as a product of different cultures. Therefore to understand a modern nation truly, one must think of national or international cultures in terms of many stories (equivocal) and in terms of transgressing (crossing) political, geographic, and cultural boundaries. He often writes of individual and national identity as "hybrid" -- a combination of many cultural narratives.
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