Jaini, who is a product of the Delhi Golf Course and has only recently started playing "decent golf" by his own admission, had a two-day total of five-under 139, which is just a stroke behind the leading duo of Baek Seuk-hyun (70) of Korea and Simon Griffiths (67) of England.
"I am really enjoying the greens. I think it's easier for me to read the greens because it's my home course. The comfort is there. That's the advantage of playing at home. If I can continue to play like this then I can at least hope to be in contention if not anything else," said the 28-year-old unlikely star of the day.
On a tricky course which can be quite punishing if the tee shots go haywire, Jaini managed to outshine the likes of India's first PGA Tour title winner Arjun Atwal, who traded a couple of bogeys for five birdies in a 69 which left him tied 18th overall.
Another DGC product, Shamim Khan, also moved along quietly carding an even-par 72 for a share of the 11th spot.
The start of proceedings was delayed by 30 minutes on Friday due to fog but what crystal clear was that the DGC was becoming difficult to negotiate for a majority of the Indians in fray.
Three-time champion Jyoti Randhawa, who is aiming to go past Australian legend Peter Thomson as the only four-time winner of the USD 1.25 million event, had another indifferent day.
Randhawa carded a one-under 71 that left him tied 23rd on the board and he would now be looking to make a late charge for the title.
But the nightmare continued for Muniyappa, who struggled to a 75, which comprised a couple of double bogeys, an equal number of bogeys against three birdies. He was tied 94th in the final analysis with an 11-over total.
Similar was the tale of Indian-origin Swede Daniel Chopra, whose, 76 left him six-over overall in a field where the cut came at four-over.
Mukesh Kumar (70), whose previous best at the Indian Open is a tied sixth finish in the 2008 edition, was also tied seventh.
"The putter was hot today. I made a tough downhill putt from 10 feet for birdie on the 18th and an uphill one from 25 feet for another birdie on the third.
"The pin positions have been quite tough over the last two days therefore we've not seen very low scores. However, I have relished the challenge of dealing with these tough pin positions. It's got the best out of me," he said.
19-year-old Rashid Khan made the cut with a 72 to continue his reasonably successful professional debut. Rashid was tied 48th with a two-over total.
Sanjay Kumar, who was overnight tied second, slipped to tied 28th with a 76 today that left his overall total at even-par.
In all, 26 Indians out of 49 in fray missed the cut including veteran Gaurav Ghei, who did not even complete his round.