Self focusing does not happen in plasma as it has -ve refractive index, but why is it so. would it be attributed to the dominant free electrons and the phase velocity is higher than the speed of light in vacuum inside a plasma?
The focusing takes place in the conditions of light propagation in a media with spatially inhomogenious refrective index, if nonlinear effects are not taken into account. Linear focusing by plasma is known, see for example JOSF B20 N1 2003,(Spence, Butler , Hooker). Self focusing due to relativistic effects is also known (Appl. Phys. Lett 53(22) 1988 (Sprangle, Esarey, Ting, Joyce)
In addition to Pavel's answer you can also say that the self focusing of intense laser beams in plasma is due to the so-called ponderomotive force. This force is dependent on the intensity of the electromagnetic field of the laser beam. As most laser beams have a Gaussian intensity profile this force is larger in the center of the beam than on the edge. Thus electrons are pushed outward of the beam. As the refractive index in the plasma is a function of the electron density, you will get gradients of the refractive index too (in radial direction of the beam) and this leads to a lens effect, or self focusing due to a higher refractive index in the beam center compared to the one at the beam edge.
In a plasma, self-focusing occurs due to several mechanisms. One is the relativistic effect, which is significant when laser power is very high. Another is due to pondermotive force. These two mechanisms are already metioned above. Inverse bremsstrahlung absorption also can play role in self-focusing if the plasma is high-Z: when plasma is strongly heated, the density in higher temperature region where laser intensity is also higher, becomes a little lower because of pressure balance .