As a young doctor of 26, Lakshmi left for Singapore in 1940. During the surrender of Singapore by the British to the Japanese, in 1942, Dr. Lakshmi aided the wounded prisoners of war. Three years later she met Netaji Subhas Chandra Bose, a meeting that changed the course of her life. Lakshmi had heard that Bose was keen to draft women into the organization. She requested a meeting with him when he arrived in Singapore, and emerged from a five-hour interview with a mandate to set up a women’s regiment, which was to be called the Rani of Jhansi regiment. There was a tremendous response from women to join the all-women brigade. Dr. Lakshmi Swaminathan became Captain Lakshmi, a name and identity that would stay with her for life.
Captain Lakshmi was the chief of the Rani of Jhansi Regiment- an all women regiment- the first of its kind in Asia. The cadets of the regiment underwent military and combat training with drills, route marches as well as weapons training in rifles, hand grenades, and bayonet charges. The first qualified troop, numbering nearly five hundred, passed out of the Singapore training camp in March 1944. 200 more were also chosen for nursing training. The regiment participated in the successful Imphal campaign of the INA.
Captain Lakshmi was arrested by the British army in May 1945. She remained under house arrest in the jungles of Burma until March 1946, when she was sent to India – at a time when the INA trials in Delhi were intensifying the popular hatred of colonial rule.
In an interview given years later, Captain Lakshmi recalls - "To say that it was Nehru who saved the INA is absolutely false. It was the people of India who rose up in revolt and forced the British to release the INA prisoners. In a way the British did us a favor by prosecuting Prem Kumar Sehgal (a Hindu), Dhillon (a Sikh) and Shah Nawaz Khan (a Muslim). The three of them were charged for waging war against the King Emperor and the British were all set to sentence them to death. This created such a furor among the masses that it resulted in the entire country rising up and demanding the release of the three officers of the INA and the rage was such, that had they been executed not a single Englishman would have gone back alive. So the British were actually left with no choice but to release them."
After Col. Prem Kumar Sehgal's release, Captain Lakshmi married him in March 1947. The couple moved from Lahore to Kanpur, where she plunged into her medical practice, working among the flood of refugees who had come from Pakistan, and earning the trust and gratitude of both Hindus and Muslims.