The former model turned actress has been cast in the Shoojit Sircar film, which was originally titled Jaffna.
Speaking to IANS, Sircar said: "Nargis suited the role and I can assure you that she is going to surprise everybody with Madras Café. She is playing a journalist in the film."
The actress, who made her Bollywood debut in Rockstar with Ranbir Kapoor, will star opposite John Abraham.
The film has been described as a political thriller about the Tamil Tigers in Sri Lanka.
"I can't reveal the story, but it was the demand of the script. You will get to know once you see the film. I hope the audiences like this pairing," said Sircar.
Fakhri, who is rumored to be dating Uday Chopra, is the focus of speculation following reports that the two plan to marry in March.