Did Nizam of Hyderabad donate 5000 kg gold to India after independence? Uncovering truth behind 60-year-old story

In the past, kings, nawabs, emperors, and sultans often donated large sums of wealth, such as gold or gold coins, as charity. These royal acts of generosity are seen as part of history, with the Nizam of Hyderabad being one of the most notable figures in this regard. The story of the 7th Nizam of Hyderabad, Mir Osman Ali Khan, supposedly donating 5000 kilograms of gold to the Indian government has often been discussed, but is this true? At first glance, donating 5000 kilograms of gold seems difficult to believe, given the massive quantity involved.

It’s a fact that the Nizam was extremely wealthy. His wealth included tons of gold and precious diamonds. This made it seem reasonable that he could have donated such a vast amount of gold. However, the reality is a bit different.

The story began in 1965, during the second war between India and Pakistan, which caused severe economic strain on India. During this period, the Indian Prime Minister, Lal Bahadur Shastri, appealed to the nation to donate to the military fund to support the country in this time of crisis. He met with Mir Osman Ali Khan, the Nizam of Hyderabad, to discuss the situation. Following this meeting, rumors began to spread that the Nizam had donated 5000 kilograms of gold to aid the country.

For decades, this story was widely discussed, though the truth remained unclear. In 2020, Nawab Najaf Ali Khan, one of the grandsons of the Nizam, confirmed the rumor. However, it wasn’t a donation as commonly believed. Instead, Mir Osman Ali Khan invested 425 kilograms of gold in the National Defence Gold Scheme, which was introduced during the war. In return, he was promised an interest rate of 6.5%. This was confirmed through a Right to Information (RTI) response from the Prime Minister’s Office in 2019.

Mir Osman Ali Khan, the last Nizam of Hyderabad, was widely regarded as India’s first billionaire. He was one of the wealthiest individuals in the world during his time. Born in 1886, he ruled over the Princely State of Hyderabad, the largest state in British India. His immense wealth, which was said to account for about 2% of the U.S. GDP at the time, earned him recognition on the cover of Time magazine in 1937.

The Nizam was also known for his contributions to modernizing Hyderabad. He played a key role in introducing electricity to the state and founded important institutions like Osmania University, Osmania General Hospital, the State Bank of Hyderabad, Begumpet Airport, and the Hyderabad High Court. When he passed away in 1967, over a million people attended his funeral to mourn his death and pay their respects. His legacy continues to live on as one of the most influential figures in India’s history.