The Jacob Diamond, one of the most valuable gems in the world, was famously said to have been used as a paperweight by the last Nizam of Hyderabad, Mir Osman Ali Khan.
Over centuries, the city reinvented itself from Golconda to Hyderabad to Secunderabad to Cyberabad and now Future City. In all these reincarnations, it charmed visitors through the sweeping circular roads, the bustling banks of the Musi, and the aroma of the famed Hyderabadi Biryani.
The majority of industry experts credit this modern-day reincarnation of Cyberabad to India’s economic liberalisation in 1991 and a series of policy reforms by successive governments.
A perfect metric to capture this transformation is the growth in information technology (IT) exports. Thanks to Hyderabad, Telangana’s IT exports soared to ~3.13 trillion in 2024-25, up over fivefold from ~57,258 crore in 2013-14, during the time Telangana was carved out of Andhra Pradesh. Hyderabad has been the capital of Telangana since then.
Take the case of the Software Technology Parks of India (STPI) Hyderabad. Its exports were hardly ~4.76 crore in 1992-93 (FY93), with 11 registered units. They touched ~1.45 trillion in FY25. In a liberalised India, STPIs, started in 1991, provided initial infrastructure, high-speed international data connectivity, incubation facilities and a single-window interface for software exporters.
Maitrivanam was one of the earliest physical homes of Hyderabad’s software industry and the STPI ecosystem in the 1990s, before the evolution of HITEC City in Madhapur in 1992.
According to Rama Krishna Sangem, a veteran political analyst, the turning point was liberalisation, which coincided with the rise of Nara Chandrababu Naidu (current chief minister of Andhra Pradesh) to power as chief minister between 1995 and 2004. In his prime, he was called the ‘CEO CM’ by admirers for his ability to attract investments.
In the 1990s and early 2000s, Naidu and then Karnataka Chief Minister SM Krishna shared a famous, friendly tech rivalry to position their respective capitals — Hyderabad and Bengaluru (then Bangalore) — as India’s premier IT hubs.
It was one meeting Naidu had with Microsoft founder Bill Gates that changed Hyderabad.
In a recent interview, Naidu told Business Standard that he secured a 10-minute appointment with Gates in New Delhi in March 1997 with great difficulty. Naidu himself prepared a presentation pitching Hyderabad as a possible destination for Microsoft. “Impressed by the presentation, the meeting lasted 45 minutes,” Naidu recalled. The result was almost immediate as Microsoft established its India Development Centre in Hyderabad in 1998.
“This was the turning point; other firms followed Microsoft in converting Hyderabad into a tech capital. In the meantime, the city also expanded its wings beyond software development to BPO (business process outsourcing), IT services, research and development, engineering services, and product development among others,” Sangem says.
The rest, as they say, is history. Microsoft was followed by other tech giants like Oracle, IBM, Infosys, Tata Consultancy Services, Wipro, Cognizant, Google and others in the late 1990s and 2000s.
These tech companies reshaped the city’s landscape. “The now affluent Jubilee Hills was once a normal hilly area, and, more importantly, the Naidu government even allotted land at concessional rates as an aggressive instrument to build Hyderabad’s IT industry,” Sangem adds.
The city benefitted from the continued push it received from subsequent governments like the ones led by Yeduguri Sandinti Rajasekhara Reddy (YSR) of the Congress, and K Chandrashekar Rao of Bharat Rashtra Samithi (BRS), the first Chief Minister of Telangana.
The development of Genome Valley since 1999 and entry of new life science companies boosted its existing pharmaceutical strength into an organised biotechnology and life-sciences cluster, and created a second engine of growth. Genome Valley is now home to more than 200 biotech and pharmaceutical companies from 18 countries, and houses facilities of six of the world’s top 10 research & development (R&D) firms.
“Hyderabad has a natural advantage, and was always known for its industry. It gathered pace after 1991, also owing to the existing ecosystem. Now, a perfect example is the way the pharmaceutical industry evolved much before liberalisation,” says Madhu Yaskhi Goud, chairperson of the All India Professional Congress, the party wing that engages with professionals.
The city now accounts for nearly one-third of the country’s pharmaceutical production, one-fifth of its pharmaceutical exports, and one-third of global vaccine output, according to reports.
It boasts generic drug makers like Dr. Reddy’s Laboratories, Aurobindo Pharma, Natco Pharma, Granules India, Gland Pharma and Divi’s Laboratories, and vaccine giants like Bharat Biotech, Biological E, and Shantha Biologics.
An industry source said that BRS Working President KT Rama Rao, who was IT Minister, also played a major role in Hyderabad’s growth post-bifurcation, leading to the fivefold rise in exports since then. It was his moves that helped in the addition of global capability centres (GCCs) after 2014.
According to a Ficci and Anarock report, Hyderabad has around 515 GCCs now, which is around 20 per cent of the national total. It could get 50 to 70 more within a year because of its huge talent pool and cost advantage to foreign companies. This is leading to another transformation of the cyber city to a GCC hub.
It is driving the office market. The leasing of office space by foreign firms for GCCs increased to 4.5 million square feet (sq ft) in 2025 from 1.9 million sq ft in 2021, and fresh leasing has already crossed 3 million sq ft this year, the report added.
Amid all this, there is a section that argues that developments should be taken up by maintaining the iconic buildings in the city. “Hyderabad is a city with its old architectural buildings. The IT sector has definitely transformed the city, but I believe that growth should be planned, giving a thrust to preserving the historic assets,” says noted historian Sajjad Shahid.
In addition to IT, life sciences, and GCCs, the state is moving aggressively on medical devices, aerospace and defence, electronics, startups and AI.
Though it attracted IT bigwigs, a recent Startup Readiness Index 2026, released by city-based venture capital firm Endiya Partners, shows that its startup landscape is lagging behind rival Bengaluru, which attracted $72 billion across thousands of deals during the same period.
Another disadvantage for the state is that Hyderabad still contributes to more than 50 per cent of Telangana’s total gross state domestic product (GSDP), indicating that the growth is uneven.
Chief Minister Revanth Reddy’s “Telangana Rising 2047” vision aims to transform the state into a $1 trillion economy by 2034, and a $3 trillion global economy by 2047.
“The state has all the ingredients to achieve this goal. The Congress government is the government developing ‘Bharat Future City’ as the country’s first net-zero smart city,” says Goud. The idea is to develop around a 30,000-acre city that will act as a global hub for artificial intelligence, data centres, advanced manufacturing, research, innovation and emerging technologies. The state is also pitching its economy as a competition to international economic hubs like Singapore, Japan, and Germany.
According to media reports, Future City has already attracted close to ~5 trillion worth of investment commitments. This includes investments from TCS HyperVault, Fortune Hospitality, Amazon Web Services (AWS), and CtrlS.
According to the 2047 road map, the state will be divided into three regions: “Core Urban Region Economy (CURE), Peri Urban Region Economy (PURE) and Rural Agriculture Region Economy (RARE).”
The CURE area will be developed as a services sector hub by moving industries outside the Outer Ring Road (ORR), while rejuvenating the Musi river, and expanding the metro. The PURE region will have a new Regional Ring Road (RRR), and greenfield highways and bullet trains from Bengaluru to Hyderabad, Hyderabad to Amaravati and Amaravati to Chennai. The RARE region will focus on sectors like food processing, as it includes traditionally neglected areas.
“One advantage that Hyderabad had was its enormous land bank (23,253 acres of Nizam’s land, which mostly became part of the state after the annexation of Hyderabad through Operation Polo in 1948). Post-1991, this turned out to be a driver of growth,” says Sangem. Now, as Revanth Reddy draws a road map for growth, land available at cheap rates is its advantage versus the rest of its rival investment hubs.
As Hyderabad embarks on its latest transformation, the banks of the Musi, which once witnessed a flow of diamonds, and now data, may well be scripting India’s new tech story.
