Diagram shows hidden city (4)
I believe the answer is:
agra
'city' is the definition.
(Indian city)
'diagram shows hidden' is the wordplay.
'hidden' says the answer is hidden in the clue.
'AGRA' can be found hidden inside 'diagram shows'.
(Other definitions for agra that I've seen before include "Site of the Taj Mahal" , "includes Taj Mahal" , "Subcontinental city" , "Taj Mahal's city" , "Indian city, capital of the Mogul empire until 1658" .)