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A consignment of red sandalwood arrives at the Yokohama port in Japan, where workers are shocked to find Pushpa hidden inside one of the containers. He attacks them, demanding payment for the load but is shot and falls into the sea, triggering a flashback.

After humiliating SP Bhanwar Singh Shekhawat,^[a] Pushpa rises to power as a respected smuggler, while Shekhawat goes into hiding. Shekhawat secretly masquerades as a laborer and intercepts a massive sandalwood consignment. Meanwhile, Pushpa meets the Chief Minister of Andhra Pradesh Narasimha Reddy, but is denied a photograph with him to avoid political backlash. Offended, Pushpa vows to topple the government by making Siddappa the Chief Minister, raising ₹500 crores through sandalwood smuggling.

Pushpa strikes a deal with Central Minister Kogatam Veera Pratap Reddy and meets international buyer Hameed in the Maldives to sell 2,000 tons of sandalwood for ₹5,000 crores. Several smugglers join Pushpa’s syndicate, but Mangalam Srinu and Dakshayani, along with Shekhawat, plot to sabotage the operation. Shekhawat kills one of the syndicate members, causing fear among the others, who urge Pushpa to relinquish his leadership to Srinu.