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Extent of wealth

  • The Asaf Jah were not always among the wealthiest royal families in India. Geographical advantages such as the fertility of the Deccan and access to maritime trade did not suffice in periods of political or financial ebbs and flows.
  • The reign of the 6th and 7th Nizams brought cultural and economic growth for Hyderabad State. One example of the wealth of the Nizams are the Jewels of the Nizams, which were an international tourist attraction when they were displayed in the Salar Jung Museum.They are now secured in an RBI vault.
  • In 1948, the Hyderabad state had an estimated population of 17 million, and it generated an estimated annual revenue of £90,029,000.
  • The state had its own currency known as the Hyderabadi rupee/Hali and the Osmania sicca until 1951. By 1954, only Indian currency became the legal tender in the state of Hyderabad.
  • The last Nizam Mir Osman Ali Khan was estimated to be worth ₹6,660 million back in 1937. According to the Forbes All-Time Wealthiest List of 2008, he was the fifth richest man in recorded history.

Economic crisis of the Nizams

  • In the year 1812, a permanent Hyderabad Contingent was set up in Secunderabad. Its expenses were financed entirely by the Nizam.
  • Sikandar Jah (1768 - 1829) took significant loans at absurdly high-interest rates from William Palmer & Co. in order to meet the required cost of maintenance. Considering these financial dealings detrimental to the prosperity of the Nizam’s government and to British interests in the region, the East India Company intervened.
  • In addition, William Palmer & Co. collapsed and the state’s finances continued in a deplorable condition. Even though the Nizam drew upon all the possible resources, including his personal wealth, for the upkeep of the troops, Hyderabad was perpetually in debt to the British.
  • The British agreed to let go of the Nizam’s dues in exchange for Nizam Nasir-ud-Daula ceding the districts of Berar, Raichur and Bhir permanently to the British. The expenses of the Secunderabad Contingent were henceforth met by the British.
  • The Asaf Jahi fortunes saw some improvement in the later years of Nasir-ud-Daula’s reign due to the efforts of Salar Jung I.
  • Salar Jung I negotiated with the British and succeeded in regaining the Raichur Doab.

Sources of wealth

The primary sources of wealth for the Princely state of Hyderabad were:

  1. Mal, Mal-O-Jihat, Sair Jihat (land revenue)
  2. Rural taxation other than land revenue
  3. Peshkash from various personnel like zamindars and officials.
  4. The land revenue share which was paid to the Nizam by the Zamindars.
  5. Baghat (irrigated lands and gardens)
  6. Customs duty from the ports
  7. Salt monopoly at Machlipattanam
  8. Diamond Mines

The Hyderabad State occupied a favorable position in commercial networks within and outside the Indian subcontinent. It had a positive balance of trade due to the abundance of natural resources and their efficient use.

  • The Princely state specialised in the production of raw cotton and silk at various places including Sangareddy, Siddipet, Warangal and Mettapalli. Raw fibre was combined to produce unique textiles e.g. Mashru and Himru which were both variants of Cotton and Silk mixtures and were valued greater than even Benarasi silk itself.
  • The abundance of mineral resources was a great asset to Hyderabad. Coal, Gold, Iron, Granite, Diamond mines played a pivotal role in the state's economy.
    1. Iron ore was smelted in Warangal, Karimnagar and Nalgonda. Beyond its intuitive industrial use, the Princely state produced beautiful filigree and bidriware in Karimnagar and Warangal.
    2. Raichur Doab, Wandalli, Hatti and Topaldoddi Goldfields were important mines in the Hyderabad state, which exported gold.
  • During the reign of the last Nizam, Mir Osman Ali Khan, the Vazir Sultan Tobacco Company Limited was established. They manufactured cigarettes like Total, Charms, Charminar, Gold, Moments, Zaffran etc. It is today, the 3rd largest cigarette manufacturing company in India. Nizam Osman Ali Khan was very fond of the Charminar cigarettes which were specially rolled for him using roasted tobacco.
  • Mir Osman Ali Khan founded a Sugar factory known as Nizam Deccan Sugar Limited (NSDL) which provided substantial employment to the subjects of the Hyderabad state.