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Just like any other programming language, a standalone SIL program contains variables, functions, and conditional and repetitive clauses. Putting this inside a Jira context enables you to use Jira related routines like createIssue or linkIssue (so the script "has Jira context"). Adding an issue context inside the Jira context (so the script "has an issue context"), enables you to use field values stored on the issue, regardless of whether they are standard fields like summary, description, assignee, or custom fields.
These will be predefined and ready to use be used without any need for variable definition. When the interpreter finds a variable, it looks for it mostly the same similar as any other language would. Each block of code is a variable context. Nested blocks will push these contexts into to a stack. When looking for a variable, it starts from the current block of code and moves down the stack. If the variable is not found, it will attempt to match it against the fields on the issue (consider this at the bottom of the stack). Let's make it visual using pseudocode.
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