Nizam of Hyderabad: The Truth Behind the 5000-Kilogram Gold Donation Myth

For decades, rumors swirled around Mir Osman Ali Khan, the 7th Nizam of Hyderabad, claiming he donated 5,000 kilograms of gold to the Indian government during the 1965 Indo-Pak war. However, the truth behind this story came to light years later.

The Indo-Pak war of 1965 placed considerable economic strain on India, prompting then-Prime Minister Lal Bahadur Shastri to appeal to citizens for contributions to bolster the nation’s defense. The Nizam, known as one of the richest individuals of his time, was approached for support. Contrary to popular belief, he did not donate 5,000 kilograms of gold. Instead, as revealed through a Right to Information (RTI) request in 2019, the Nizam invested 425 kilograms of gold in the National Defence Gold Scheme, introduced by the government during the war. In return, he received an interest rate of 6.5%.

In 2020, Nawab Najaf Ali Khan, the Nizam’s grandson, confirmed this account, dispelling the long-standing myth.

Mir Osman Ali Khan, often referred to as India’s first billionaire, ruled Hyderabad — the largest princely state in British India. His wealth was once estimated to be 2% of the U.S. GDP during his era, earning him a spot on the cover of Time magazine in 1937 as the world’s richest man.

Beyond his immense wealth, the Nizam played a pivotal role in Hyderabad’s modernization. His contributions included the introduction of electricity, the founding of Osmania University, Osmania General Hospital, the State Bank of Hyderabad, Begumpet Airport, and the Hyderabad High Court.

Though the tale of the 5,000-kilogram donation proved to be a myth, the Nizam’s legacy endures through his philanthropic efforts and developmental contributions. When he passed away in 1967, over a million people attended his funeral, marking the end of an era for Hyderabad.