While on one hand, there was growing support to the Mundargi Youths in their fight against Nizam rule, on the other hand there were many important changes that were taking place in Hyderabad.
Sir Mirza Ismail had negotiated an agreement - called standstill agreement with the Indian Government for a one year period to resolve the issue of accession of Hyderabad province to Indian government amicably.
Sir Walter Monkton, the special emissary of Lord Mountbatten played an active role in arriving to this agreement.
Pro-India leaders like Nawab Mehadi Nawaz Jung, Barrister Akbar Ali Khan famous editor Sohaibulla Khan, Nawab Ali Yavar Jung and others supported' the peace moves of Sir Mirza Ismail and tried to change the attitude of the Nizam from confrontation to coordination.
But militant leaders like notorious Bahadur Khan and the leader of Razaakars - Shah-E-Dakkan, Mujahid-E-Azam, Field Marshal Qasim Rizwi had a growing influence in the government and on the decisions of the Nizam.
The Assasination of Mahatma Gandhi made these militants and the Nizam more bold and Sir Mirza Ismail quit the government in disgust.
Resignation of Sir Mirza Ismail and sidelining of pro-India leaders created panic among the Hindus and minorities like Sikhs in the Nizam province and a massive exodus started from the Nizam province to neighbouring regions.
To counter the struggle of Mundargi youths and Indian Army, the Nizam government declared compulsory training in use of fire arms to all the government staff and recruited retired British Army officers like Major Mathew, to conduct these training.
These British officers were paid heavily but did little to motivate the government officers. Major Mathew in particular enjoyed humilating the government officers even of the rank of DC, SPs, etc; in the so-called arms training.
He would say, " your .303 rifles have to loaded each time before you fire a shot. So keep a good whistle with you and when you face the Indian Army which will have self loading rifles or automatic weapons, you fire a shot and then blow your whistle. Beg the Indian army to give you time to reload your rifle and then blow your whistle again to say that you are ready to fight."
Not one had the courage to protest this humilation meted to them and all the while the Nizam government, the pro government press and the radio boasted of being well armed to the last man!!
The use of Indian currency was banned throughout the Nizam province and transfer of money through money orders from people within in the province to outside was banned.
To bolster the strength of the Razaakars, there was massive recruitment of merceranaries like Pathans, Arabs, Rohilla Tribesmen and Pakistani nationals.
Sydney cotton, the famed manufacturer of .303 rifles, sten guns and ammunition was given a massive contract to supply large quantity of arms and ammunition to the Hyderabad province in quick time.
Sardar patel, well informed about the struggle by the Mundargi youths and the havoc that they had created within Hyderabad province, planned the attack by Indian Army to liberate Hyderabad.
He gave the Nizam 5 days to put down the arms and merge the province with the Indian Union and the countdown began.