‘Madras Café’ is the story about an Indian intelligence agent, who journeys to a war-torn coastal island to break a resolute rebel group and meets a passionate journalist.
The plot opens in Jaffna, where a bus full of passengers is stopped by armed men. They take all of them out and kill them mercilessly. A little girl tries to escape, but is shot and killed immediately.
The movie then moves to Kasauli, where a bearded man, (Abraham) wakes up after having visions of men getting killed. He then finds on TV that the Sri Lankan President was killed by a human bomb. He purchases a bottle of liquor and goes to a nearby church. The priest of that church, who seems to know him for the past three years, asks him about his "conspiracy" when he says that "Our Prime Minister could have been saved from the conspiracy". The bearded man then starts narrating his story.
The film then goes five years back, when the man tells that the continuous battle between the majority in Sri Lanka Sinhalese and minorities Tamils had reached a dangerous level. In that battle thousands of Tamils lost their lives, causing their youths to take weapons in their hands and join the LTF leader Anna Bhaskaran. Due to the plight of Tamils there, the Indian Prime Minister (Sanjay Gurubaxani) decided to sign a peace accord with Sri Lankan Government and said that the elections should happen there peacefully before Diwali. However, Anna refused to accept the accord and the Indian Peace Keeping Forces were forced to withdraw from the island.
After a meeting, they discussed the strategy with RD and his deputy, Swaroop (Avijit Dutt) Vikram travels to Sri lanka and meets a war correspondent Jaya Sahni (Nargis Fakhri) and tries to find out a way to stop the rebels. After reporting to his senior Bala (Prakash Belwadi) he tries to find some that may help to find Shri, the only man who can withstand and oppose Anna. After meeting with an informer Narayanan, Vikram manages to visit Shri. Vikram promises Shri to help him rise against Anna by providing him with arms. The arms deal date is decided at 6 July. However, the deal goes terribly wrong and one of Vikram's associates is killed in a surprise attack by LTF. Bala scolds Vikram of his working style and tells him to go to Colombo Safehouse. Vikram meets Jaya to seek her help. Jaya tells him that they know his next step even before he implement it. However, she tells him that "Before I came here, a foreign agency guy met with an Indian official." Next day, Vasu, Bala's associate, meets a man, gives him a photo of Vikram, telling him "to keep him alive".
As told by Jaya, Vikram reaches Bangkok and picks a taxi. he reaches Happyland Fish Market, where a source of Jaya (Dibang) tells him that he has a tape. Vikram is shocked to see that Bala was honeytrapped, forcing him to divulge all the information about their movements. Bala is later confronted by Vikram on phone; he later commits suicide by shooting himself. RD realises that this might be a Code Red, to assasinate the Prime Minister. He asks Vikram to take care of this and tells his team to seal the coastline. A massive manhunt begins and hundreds of LTF associates are nabbed by Indian security forces and local cops. In the Madras RAW office, Arjun, an officer tracks down the conversation of Vijayan Joseph, a bombmaker and Anna and tells this to Rishi (Tarun Bali). Rishi tells this to Vikram and further says that Kannan Kanan, an associate of Anna's man Kanda, is in Madurai Jail and might be helpful. Kannan reveals that some suspicious refugees came from the island to Tamil Nadu. After a short but important meeting with Jaya, Vikram sees X on a clock at the Airport and deduces that the LTF is going to assassinate PM on the same day at X PM (10 PM). RD then calls the PM to cancel his rally. PM says that he will be fine and not to worry about him. Vikram then manages to catch Vijayan from his hideout who tells that the refugees are going to assassinate the PM by plastic explosives which are untraceable to metal detectors.
Vikram rushes to the place where the PM is taking part in the rally. He reaches there nearly on time, but the suicide bomber manages to put the wreath on the neck of the PM and while bowing down, she pulls the trigger and kills the PM along with herself and many others. Vikram recovers but sits there dejected and defeated. Later, Vikram submits his report on the assassination to the investigation committee who considers his report. A few days later, RD too resigns, and Vikram, after taking a voluntary retirement, comes in Kasauli.
The movie comes to present where the priest asks Vikram who won the battle. Vikram says he doesn't know, but in this battle, Indians lost their Prime Minister and Lankan Tamils lost their future. He later walks away, reciting the linings told by Ruby's father on their wedding day. He completes another report and sends it to Jaya in Singapore. She starts her work on the report. In Kasauli, Vikram moves of the house he was living in.
An epilogue tells that the civil war continued for 27 years, killing more than 40 thousand Sri Lankan subjects, 30 thousand Tamil rebels, 21 Sri Lankan forces and 1200 Indian forces, and still thousands of Lankan Tamils are homeless. In 2009, Sri Lankan forces launched a massive a brutal aerial and land attack, finishing the rebels, and the credits roll. The movie is an earnest and honest effort, a terrific thriller, with several poignant moments and episodes that leave a stunning impact.