The Fascinating Story of the Jacob Diamond

At 185 carats, the Jacob Diamond is one of the largest diamonds in the world. Contrary to popular belief, it was not mined in Golconda, but in the Kimberley Diamond mines on South Africa.

It found its way through a rather circuitous route to a diamond merchant called Alexander Malcolm Jacob, whose shop in Shimla was a popular stop for wealthy visitors looking for an interesting jewel or knick-knack. Jacob would source precious stones primarily from London, and make it available to Indian royalty, making a healthy profit in the bargain!

When the Jacob Diamond came into his possession, A M Jacob knew he had to get a really good price for it. His choice of customer was perhaps one of the richest men in the world at that time – the Nizam of Hyderabad, Mir Mehboob Ali Khan, Asaf Jah VI. His wealth was legendary, and he had a penchant for all things western.

Jacob was wary of traveling to a foreign land with such a precious cargo – so he had a replica made, and took it to the Nizam. His trip to Hyderabad in 1891 was eventful, to say the least. The British, who had a Resident in Hyderabad and had their finger in every pie, suspected Jacob of being a Russian spy and initially gave him a hard time. But he persevered, and got an introduction to the Nizam through Albert Abid, the Nizam’s Armenian valet.

Jacob met with the Nizam, and showed him the replica. The Nizam was interested in the diamond, but not the high price that Jacob was quoting him – one crore rupees. Eventually, the price was settled at about half that amount. A bank account was opened in the Bank of Bengal, and the Nizam deposited half the agreed amount in it. He would deposit the rest of the money once he received the actual diamond.

Jacob went away and came back with the diamond, only to be met with dissatisfaction by the Nizam. “The stone is smaller than you told me,” he said to Jacob, and refused to take it. He demanded his money back, but by then Jacob had already emptied the bank account. The Nizam then sued Jacob in a case that went nowhere. Finally, the Nizam paid for Jacob’s legal expenses but retained the diamond. This bankrupted Jacob, who ultimately died in penury in Mumbai.

The diamond, after being displayed proudly to the last Czar of Russia and Archduke Ferdinand of Austria when they visited Hyderabad, lost its charm for the Nizam, and he stuffed it into an old shoe and cast it aside. It was lost from public view for a while. The sixth Nizam passed on and his son, Mir Osman Ali Khan became the seventh Nizam. He found the shoe with the diamond in it in a drawer used by his father, and used it as a paperweight after having a golden stand made for it.

The seventh Nizam was known for his wealth – he was on the cover of Time magazine as the world’s wealthiest person, and his use of a million-dollar paperweight was touted as one of his quirks.

Finally, after Hyderabad became part of India, the Indian government acquired the fabulous jewel and locked it away. It has been lying in the vaults of the Reserve Bank of India, seen outside only three times. I was lucky enough to see it when it was on display at the Salar Jung Museum in 2003. It’s a beautiful diamond, significantly bigger than the current size of the Koh-i-noor.

In the picture: A painting of the sixth Nizam, Mir Mehboob Ali Khan at Chowmahalla Palace