One bird in hand.
Two birds in tree.
I have faced a similar situation.
I took the seat allotted to me in AIR 1
With growing competition every year, I did not risk losing a hard earned seat.
At least even if I don’t upgrade, I will be an MD after 3 years.
I am happy with that.
If u r alloted with ur dream branch in ur state then opt it and don’t participate in AI R2. If not then resign state seat and go for AI R2.