The Nazarana System
Legal Bribery · Systematic Extraction · The Nizam's Private Revenue Stream
The Nazarana system (also referred to as Nazar or Nuzur) was a traditional practice of presenting gifts to the ruler that, during the later years of the Hyderabad State, evolved into what critics described as a "money grabbing policy" and a "scandalous" method of systematic extraction. Under Mir Osman Ali Khan, the last Nizam (reigned 1911–1948), the system reached its zenith — condemned as "legal bribery" in a public appeal on 17 June 1926. It became a central grievance of the political movements that eventually led to the integration of Hyderabad into the Indian Union.
"The original custom consisted of small presents offered on rare and auspicious occasions. It was a ceremonial gesture where the ruler would typically only 'touch' the gift in token of acceptance and return it, sometimes providing a counter-gift of greater value."
Traditional Practice: The practice of nazar or nazarana was not an invention of the Nizams. It had been prevalent in the Mughal courts, and since the Nizams were a breakaway from the former, the practices were inherited. Traditionally, it consisted of small presents offered on rare occasions — births, weddings, coronations, or victories. The ruler would typically only "touch" the gift in token of acceptance and return it, sometimes even providing a counter-gift of greater value. It was a ceremonial gesture, not a source of revenue.
"Scandalous" Evolution: By the early 20th century, the system was transformed into a tool for pecuniary gain — described as a "systematic campaign" arranged by subordinate officers to recover large sums as if it were a mandatory tax. What had once been a voluntary ceremonial offering became a quasi-official levy, demanded with increasing frequency and at increasingly higher rates.
Efforts at Abolition — Repeatedly Ignored: The British repeatedly hinted to the Nizam — once through Sir Ali Imam — that "nazars" should be done away with. The Nizam at least three times proclaimed by "Firman" that they had been abolished, yet presentation of "nazars" continued unabated, even during his tours to Aurangabad and Jalna.
Darshan Fees During Royal Tours: During the Nizam's visits to districts like Aurangabad and Jalna, subjects were charged "fees" just for the opportunity to have a darshan (sight) of the ruler. The charges were rated on a sliding scale ranging from Rs. 100 down to Re. 1 per person. Government officers were actively "bringing people" to the ruler to collect these fees — a well-organized revenue extraction machine operating for the Nizam's private chest.
Sale of Appointments: Former civil servant V.K. Bawa notes: "There were rumours regarding the sale of appointments for Rs 25,000 to Rs 30,000 for the post of taluqdar or district officer." The Nizam's private secretary, Fariuddun-ul-Mulk, told the British resident that the Nizam had "a mania for collecting nazars." When countered by the British resident about the sale of appointments, the Nizam said he reserved the right to accept any amount offered, asserting he was taking only "a few ashrafis" — a statement met with disbelief.
Nazar from Employees and Villages: Employees of the state had to pay nazars based on salary: those getting Rs. 30–60 paid Rs. 15; those getting Rs. 60–100 paid Rs. 30. Villages as a whole were not exempt — they had to pay five goats, ten fowls, two cart loads of grass, and tent pegs. The Nizam even insisted on receiving nazars from anyone unlucky enough to receive gifts from the palace — vegetables, honey, mangoes from the royal gardens, and even paan (betel leaf). Not only were both Muslims and Hindus victims, Mir Osman Ali Khan did not even spare his half brothers — transferring property bought for his half brother Salabat Jah into his own name after accession.
"In March 1923 a circular was issued from the Nizam's education department inviting students of middle schools to meet with the Nizam at Hyderabad's public gardens. The invitation specified the amount that the 'student would have the honour of presenting' to his exalted Highness."
The Circular: The worst example of nazar was witnessed when a circular was issued from the Nizam's education department inviting middle school students to meet the Nizam — and specifying the amount each student had to pay. Children were being asked to pay for the privilege of meeting their ruler, an act that shocked even the British.
Resident's Intervention: The British Resident was upset with this circular, and fourteen letters and prolonged negotiations later, a reluctant Nizam ordered it to be withdrawn. The fact that such a circular could be issued — and that it took fourteen letters to get it withdrawn — speaks volumes about the normalization of the nazar system in Hyderabad's administration.
"Unlike official taxes, the money collected through Nazarana did not enter the State coffers for public works or welfare. Instead, it went directly into the 'private chest of the ruler' and never returned to the people in any form."
Not a State Revenue: A major point of public grievance was that money collected through Nazarana did not enter State coffers for public works or welfare. Instead, it went directly into the "private chest of the ruler" (sarf-i-khas) and never returned to the people. The Nizam's personal wealth — jewellery, pearls, uncut diamonds, tonnes of bullion, and huge quantities of currency notes — accumulated through six generations remained intact even when the state treasury was nearly bankrupt upon his accession in 1911.
The Berar 'Chanda' Connection: This extractive mindset was linked to other forced collections, such as the 'Chanda' raised to ostensibly buy back the region of Berar from the British. Although a Firman eventually ordered the return of these collections to donors, it remained uncertain how much money actually reached the original contributors.
Nazar as Political Subordination: Beyond extractive tours, nazur remained a staple of courtly life. The act of giving nuzur defined administrative hierarchy — the Peishkar was required to give nuzur to the Minister, signifying subordinate status. Significant life events were marked by large offerings: during the betrothal of the Nizam's eldest sister in 1891, Nawab Sir Kurshedjah presented a nazur of approximately 120 gold mohurs.
Salar Jung's Abolition Attempt: The great Diwan, Salar Jung I (served 1853–1883), in his sweeping administrative reforms, stopped the nazarana system routinely offered to the Nizam in open court. This enraged the Nizam, who wanted to dismiss him in 1859, 1861, 1862, and 1867, calling him a 'Firangi Bachcha' for his habitual support to the British. On all such occasions, the Resident mediated and saved Salar Jung from dismissal. The Viceroy himself warned the Nizam: "If Your Highness were to dispense with the aid of Salar Jung, the country would relapse into a state of misrule and confusion... the British Government might be forced to interpose its authority." The nazar system remained suppressed during Salar Jung's tenure — but returned with a vengeance under Mir Osman Ali Khan.
"Want of protection of the primary rights of the subjects was the main grievance... The 'Nazarana' system was condemned as legal bribery... A Legislative Council which was promised five years ago is not yet born, and a request was made to His Exalted Highness to redeem his promise."
1926 Condemnation: On 17 June 1926, a public appeal listed the primary grievances of the subjects of Hyderabad State. The "Nazarana" system was condemned as "legal bribery." The appeal also noted that a Legislative Council had been promised five years earlier but was "not yet born."
Broader Grievances: The appeal indicated no protection for Hindu temples, Hindu women, and Hindu religious rights. All elementary rights of liberty of speech, press, religious worship, and faith were denied to Hindus. The whole administration, it was claimed, was manned by Moslems from the north who were anti-Hindu. The attack on existing vernacular schools would lead to a complete stoppage of teaching through vernaculars and of Hindu religion and culture. Imposition of Urdu was condemned in unequivocal terms.
System End Date: The traditional Nazarana and feudal privileges were officially dismantled following Operation Polo (the "police action") in September 1948, which ended the independent reign of the last Nizam and integrated Hyderabad into the Indian Union.
Legacy: The memory of the nazarana — as a symbol of the Nizam's arbitrary power, personal avarice, and systematic exploitation — lived on. It became a central element of the critique of feudal rule that fueled the Telangana Peasant Movement (1946–1951) and the demand for democratic reforms.
The Frozen Fund Controversy: Even after his death, the Nizam's wealth — much accumulated through nazars — became subject to legal dispute. Approximately £30 million (the "Nizam's Fund") lies frozen in a NatWest Bank account in London, with multiple claimants including the Government of India, the Government of Pakistan, and the Nizam's heirs. Some analysts argue the money belonged to Hyderabad state (not the Nizam's sarf-i-khas), and therefore should not go to his heirs.
- Mir Osman Ali Khan (1886–1967): Last Nizam of Hyderabad (reigned 1911–1948). Under his rule, the nazarana system reached its peak. Known for his "mania for collecting nazars" (according to his own private secretary). Charged school children for the privilege of meeting him.
- Sir Salar Jung I (1829–1883): Diwan of Hyderabad (1853–1883). Stopped the nazarana system in open court, earning the Nizam's enmity. Saved from dismissal four times by British intervention and Viceroy's warning.
- British Resident Barton: c. 1920. Wrote that the nazar system was "poisoning public life" and appointments were sold to the highest nazar payer.
- Fariuddun-ul-Mulk: Nizam's private secretary and later Sadr-i-Azam. Told the British resident that the Nizam had a "mania for collecting nazars."
- Nawab Sir Kurshedjah: Presented nazar of approximately 120 gold mohurs at the 1891 betrothal ceremony.
- Mahbub Ali Pasha: Previous Nizam (reigned 1869–1911). Profligate spender who left the state treasury nearly bankrupt upon his death.
- Traditional Practice: Ceremonial gift-giving at Mughal courts; ruler would "touch" the gift and often return it with a counter-gift.
- "Scandalous" Evolution: By early 20th century, transformed into a "systematic campaign" for pecuniary gain. Darshan fees charged on a sliding scale (Rs. 100 to Re. 1) during district tours.
- Sale of Appointments: Taluqdar positions sold for Rs. 25,000–30,000. "Most important appointments are filled by men who have paid the highest nazar" — British Resident Barton.
- School Children Scandal (1923): Education department circular specified amounts children must pay to meet the Nizam. Rescinded after fourteen letters from British Resident.
- Diversion of Funds: Money went to Nizam's private chest (sarf-i-khas) — never to state coffers or public welfare.
- Salar Jung's Abolition Attempt: Stopped nazar in open court; Nizam tried to dismiss him four times; saved by British intervention.
- Political Condemnation (1926): Nazarana condemned as "legal bribery" in public appeal. Demand for Legislative Council (promised but not delivered).
- End of System (1948): Operation Polo ends Nizam's rule; nazarana system dismantled. Nizam's frozen funds (£30 million) still disputed in London.
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