If I select Ubuntu Mono for Font in the terminal settings window, Telugu text shows as blank rectangles.
If I select Pothana2000 font Telugu text renders okay but none of the English text renders.
May be this is related to this SO question.
Created attachment 163526 [details]
Terminal Emulator Image when font is set to Pothana2000
Created attachment 163527 [details]
Terminal Emulator Image when font is set to UbuntoMono
Created attachment 163528 [details]
JComponent rendering Telugu Text
41385 does talk about Indic fonts. But I am not certain this new bug is related to that. As the images show, The terminal renders the Telugu text very well when the font selected is Pothana2000. So the assumption than each character is a block wide doesn't seem to affect the rendering (unless I am missing something obvious).
In my limited understanding most applications fallback to other fonts when the currently selected font doesn't support the input characters. That is why no matter what font I select, the Netbeans editor shows the other language text okay. I think this is a code issue. For some reason the default behaviour, which works on a regular JComponent is being overridden in the implementation of Term in the lib.terminalemulator.
Just to illustrate that the Telugu text is rendered fine on a JComponent without setting a font that explicitly supports Telugu language, I have attached is a main class that does this.