Episode 2 of "Saare Jahan Se Acha" kicks off with a tense scene where Murtaza Malik and his henchmen lay down an ultimatum to Junaid Khan, an informant trembling with fear. With death looming over him, Khan spills the beans about a high-ranking officer within the Pakistani military cloaked as an informant. However, when Khan fails to divulge the officer's identity, Murtaza ruthlessly terminates his life.
At RAW's clandestine intelligence headquarters, Vishnu receives a briefing from a colleague, uncovering details about the covert agents embedded in Pakistan under Nausad Ahmed's command. Among them are Naik, the now deceased Junaid Khan—news of whose disappearance has yet to reach the RAW agents—Rafiq Ahmed (alias Sukhbir), and Rizwan Ahmad Chaudhary.
Just as the agents grapple with Khan's vanishing act, it transpires that Khan didn't possess any high-level intelligence capable of posing a threat to RAW. Vishnu's peer cautions him to fly under the radar, warning of ISI's heightened activity. In light of this, Vishnu decides to confront Naushad in Budapest, Hungary.
During their clandestine meeting, Vishnu places Naushad under a dire ultimatum, threatening to expose his secrets to the ISI unless he reveals the location of Pakistan's nuclear facility. In return for his freedom, Vishnu vows to facilitate Naushad's identity change and ensure his family's safe passage abroad, far from the ISI's reach.
Meanwhile, back in Pakistan, Naushad sneaks into the ISI office in search of crucial information but stumbles upon Murtaza's intelligence about a senior Pakistani officer colluding with India's RAW. Murtaza and his agents discuss Vishnu, an Indian officer reassigned to the Bilateral Trade Commission in Pakistan, with suspicion cast firmly upon him.
Convinced of Vishnu's RAW affiliation, Murtaza tasks his trusted deputy and brother-in-law, Gulam, with closely monitoring Vishnu's every move.
Elsewhere, Vishnu and his wife, Mohini, are out shopping when a shadowy figure smashes their car window, leaving a grim reminder in the form of a bloody, deceased rat. Mohini's concern for Vishnu's safety escalates, while Vishnu gleans from RAW's international informant, Vikram Deewan, about Pakistan's arms dealings in Paris. Vishnu promptly alerts Mr. Kao to the arms deal, who, though irked, orders Vishnu to delve deeper into the matter.
Vishnu further apprises Mr. Kao that Naushad is determined to exert every ounce of effort to procure the information, driven by his yearning for liberation from Pakistan's grip. Naushad, keeping his wife in the dark about his covert ties with India and RAW, hastily packs his family's belongings. Unexpectedly, Murtaza arrives at his doorstep, catching a glimpse of the packed luggage. Naushad weaves a tale to deceive Murtaza and assures him of his attendance at his daughter's birthday celebration. Additionally, he volunteering to invite the Defence Secretary, Aabid, on Murtaza's behalf, subsequently visiting Aabid's residence in his absence to convey the intelligence to Vishnu.
Later that evening, Murtaza makes an unannounced visit to Vishnu's abode, where he crosses paths with Mohini. Their conversation blooms into a revealing dialogue, with Mohini on the verge of disclosing something potentially damaging to Vishnu. Fortunately for Vishnu, he arrives in the nick of time to defuse the tense situation. Murtaza, before departing, leaves a gift, which Vishnu meticulously examines, uncovering a concealed message within. The message alerts Vishnu to the fact that an ISI officer has his sights set on him.
Meanwhile, Naushad succeeds in relaying coordinates to one of his informants, a local shopkeeper. Simultaneously, Murtaza and Pakistani defense officials endeavor to trace the call's origin. They strive to decipher the receiver's location and raid numerous shops, including that of Naushad's informant. They eventually locate the shop and Murtaza assigns Gulam to monitor it, aiming to uncover the informant's superior.
The episode then introduces us to Rafiq, an Indian agent who has been masquerading as a Pakistani broker. With a heart pounding, Rafiq attempts to extract the coordinates from the informant, but his attempts are interrupted by the sight of Murtaza's men lurking nearby. Quick-thinking, he shifts his approach and cautiously enters the shop, only to witness the harrowing scene of ISI agents apprehending the RAW informant. Terrified for his own safety, Rafiq urgently dials Vishnu, confessing that he has given up his family and life to live in Pakistan under a fake identity. He fears that RAW will soon use him as a pawn to absolve themselves of blame.
Meanwhile, Rafiq maintains his facade as a broker with remarkable composure in front of a Pakistani army officer. Unbeknownst to the officer, his sister, Naseem, harbors secret affections for Rafiq, slyly flirting with him whenever her brother is out of sight.
Later that evening, Vishnu receives a startling update: Naushad's fake passports were slated for delivery that very night. In a swift decision, he halts the delivery, as RAW is still devoid of the coordinates of the Pakistani nuclear base. He resolves to hand over the passports to Naushad only after securing the intelligence. His colleague urges Vishnu to let Naushad fend for himself, but Vishnu stands firm, arguing that Naushad has selflessly devoted years of his life to aiding India and deserves this freedom.
Murtaza discovers that the information passed to the saree shop informant was of the utmost confidentiality. He instructs Gulam to intensify their scrutiny of the military officers. Naushad, realizing that his passports have gone astray, finds movie tickets tucked inside the package and decides to spend the evening at the cinema.
Vishnu brings Mohini along to the theatre, setting the stage for an unexpected encounter. That night, Murtaza's daughter reveals that Naushad's family is en route to Europe. The penny drops for Murtaza; Naushad is the RAW informant. Learning from Naushad's son that he is at the cinema, Murtaza rushes there, intent on capturing Naushad, who is cleverly concealing himself inside the cinema hall as the episode reaches its cliffhanger conclusion.
