Iqbal dissolves the apparent conflict between God's individuality and God's infinity by distinguishing two kinds of infinity: the merely spatial 'bad infinity' of endless extension, and the intensive infinity of inexhaustible creative possibility. God is infinite in the second sense — and the universe we know is only a partial expression of it.
Section 1 established that God is an individual — a definite, unique, creative ego whose individuality is not compromised by the tendency toward fragmentation that characterises all biological life. But the very success of that argument raises an objection that has haunted Western and Islamic philosophy alike: does not individuality imply finitude? To be individual is to be this and not that, to have a definite character that distinguishes one being from others. But to be distinguished from others is to be bounded — and to be bounded is to be finite. If God is individual, how can He be infinite?
This short but philosophically dense section is Iqbal's answer. He does not evade the objection; he dissolves it by showing that it rests on an impoverished concept of infinity. The kind of infinity that is incompatible with individuality is spatial or extensive infinity — the infinity of mere endlessness, of a void stretching in all directions, of a series that never terminates. This is what Hegel called 'bad infinity,' and Iqbal agrees that it is philosophically worthless. 'In matters of spiritual valuation mere immensity counts for nothing.' The alternative is intensive infinity — the inexhaustibility not of spatial extension but of inner creative possibility. God's infinity is not that He fills all space (that would make Him omnipresent, not absolute — a distinction Section 1 already drew) but that His creative activity contains possibilities that no finite expression can exhaust.
To reach this conclusion, Iqbal makes a move through modern physics: if space and time are not absolute containers but relational structures arising from the mutual interactions of events — as Einstein's relativity implies — then they are not independent realities that could 'close off' God from the outside. Space and time are, in Iqbal's formulation, 'possibilities of the Ego, only partially realized' in the physical universe as we know it. Beyond God's creative activity there is no space or time at all, and therefore nothing in reference to which He could be called either finite or spatially infinite. The question dissolves once the false presupposition — that infinity must mean spatial boundlessness — is removed.
The section is brief because the argument is compressed, but its consequences are far-reaching. If God's infinity is intensive rather than extensive, then the universe we inhabit is not the whole of divine creativity but a partial expression of possibilities that extend beyond anything we currently know. Creation is not exhausted. The future is genuinely open. And this openness is not a deficiency but the expression of an inexhaustible creative source.