The most important challenge to the decaying Mughal power came from the Maratha Kingdom, which was the most powerful of the Succession states. In fact, it alone possessed the strength to fill the political vacuum created by the disintegration of the Mughal Empire.
The Maratha Kingdom produced a number of brilliant commanders and statesmen needed for the task. But the Maratha Sardars lacked unity, and they lacked the outlook and program, which were necessary for founding an all-India empire.
Shahu, the grandson of Shivaji, had been a prisoner in the hands of Aurangzeb since 1689.
Aurangzeb had treated Shahu and his mother with great dignity, honor, and consideration, paying full attention to their religious, caste, and other needs, hoping perhaps to arrive at a political agreement with Shahu.
Shahu was released in 1707 after Aurangzeb’s death.
A civil war broke out between Shahu at Satara and his aunt Tara Bai at Kolhapur who had carried out an anti-Mughal struggle since 1700 in the name of her son Shivaji II after the death of her husband Raja Ram.
Maratha Sardars, each one of whom had a large following of soldiers loyal to themselves alone began to side with one or the other contender for power.
Maratha Sardars used this opportunity to increase their power and influence by bargaining with the two contenders for power. Several of them even intrigued with the Mughal viceroys of the Deccan.
Arising out of the conflict between Shahu and his rival at Kolhapur, a new system of Maratha government was evolved under the leadership of Balaji Vishwanath, the Peshwa of King Shahu.
The period of Peshwa domination in Maratha history was the most remarkable in which the Maratha state was transformed into an empire.
Balaji Vishwanath, a Brahmin, started life as a petty revenue official and then rose step by step as an official.
Balaji Vishwanath rendered Shahu loyal and useful service in suppressing his enemies. He excelled in diplomacy and won over many of the big Maratha Sardars.
In 1713, Shahu made him his Peshwa or the mulk pradhan (chief minister).
Balaji Vishwanath gradually consolidated Shabu’s hold and his own over Maratha Sardars and over most of Maharashtra except for the region south of Kolhapur where Raja Ram’s descendants ruled.
The Peshwa concentrated power in his office and eclipsed the other ministers and’ seniors.
Balaji Vishwanath took full advantage of the internal conflicts of the Mughal officials to increase Maratha power.
Balaji Vishwanath had induced Zulfiqar Khan to pay the chauth and sardeshmukhi of the Deccan.
All the territories that had earlier formed Shivaji’s kingdom were restored to Shahu who was also assigned the chauth and sardeshmukhi of the six provinces of the Deccan.
In 1719, Balaji Vishwanath, at the head of a Maratha force, accompanied Saiyid Hussain Ali Khan to Delhi and helped the Saiyid brothers in overthrowing Farrukh Siyar.
At Delhi, Balaji Vishwanath and the other Maratha Saradars witnessed at first hand the weakness of the Empire and were filled with the ambition of expansion in the North.
Balaji Vishwanath died in 1720 and his 20-year old son Baji Rao I succeeded as Peshwa. In spite of his youth, Baji Rao I was a bold and brilliant commander and an ambitious and clever statesman.
Baji Rao has been described as “the greatest exponent of guerrilla tactics after Shivaji”.
Led by Baji Rao, the Marathas waged numerous campaigns against the Mughal Empire trying to compel the Mughal officials first to give them the right to collect the chauth of vast areas and then to cede these areas to the Maratha kingdom.
By 1740, when Baji Rao died, the Maratha had won control over Malwa, Gujarat, and parts of Bundelkhand. The Maratha families of Gaekwad, Holkar, Sindhia, and Bhonsle came into prominence during this period.
Baji Rao died in April 1740. In the short period of 20 years, he had changed the character of the Maratha state. From the kingdom of Maharashtra it had been transformed into an Empire expanding in the North (as shown in the map below).
Baji Rao’s 18-year old son Balaji Baji Rao (also known as Nana Saheb) was the Peshwa from 1740 to 1761. He was as able as his father though less energetic.
King Shahu died in 1749 and by his will left all management of state affairs in the Peshwa’s hands.
The office of the Peshwa had already become hereditary and the Peshwa was the de facto ruler of the state. Now Peshwa became the official head of the administration and, as a symbol of this fact, shifted the government to Poona, his headquarters.
Balaji Baji Rao followed in the footsteps of his father and further extended the Empire in different directions taking Maratha power to its height. Maratha armies now overran the whole of India.
Maratha control over Malwa, Gujarat, and Bundelkhand was consolidated.
Bengal was repeatedly invaded and, in 1751, the Nawab of Bengal had to cede Orissa.
In the South, the state of Mysore and other minor principalities were forced to pay tribute.
In 1760, the Nizam of Hyderabad was defeated at Udgir and was compelled to cede vast territories yielding an annual revenue of Rs. 62 lakhs.
Later, the arrival of Ahmad Shah Abdali and his alliance with the major kingdoms of North India (including an alliance with Najib-ud-daulah of Rohilkhand; Shuja-ud-daulah of Avadh, etc.) lead to third battle of Panipat(on January 14, 1761).
The Maratha army did not get any alliance and support resultantly was completely routed out in the third battle of Panipat.
The Peshwa’s son, Vishwas Rao, Sadashiv Rao Bhau and numerous other Maratha commanders perished on the battle field as did nearly 28,000 soldiers. Those who fled were pursued by the Afghan cavalry and robbed and plundered by the Jats, Ahirs, and Gujars of the Panipat region.
The Peshwa, who was marching north to render help to his cousin, was stunned by the tragic news (i.e. defeat at Panipat). Already seriously ill, his end was hastened and he died in Jun 1761.
The Maratha defeat at Panipat was a disaster for them. They lost the cream of their army and their political prestige suffered a big blow.
Afghans did not get benefit from their victory. They could not even hold the Punjab. In fact, the Third Battle of Panipat did not decide who was to rule India, but rather who was not. The way was, therefore, cleared for the rise of the British power in India.
The 17-year old Madhav Rao became the Peshwa in 1761. He was a talented Soldier and statesman.
Within the short period of 11 years, Madhav Rao restored the lost fortunes of the Maratha Empire. He defeated the Nizam, compelled Haidar Ali of Mysore to pay tribute, and reasserted control over North India by defeating the Rohelas and subjugating the Rajput states and Jat chiefs.
In 1771, the Marathas brought back to Delhi Emperor Shah Alam who now became their pensioner.
Once again, however, a blow fell on the Marathas for Madhav Rao died of consumption in 1772.
The Maratha Empire was now in a state of confusion. At Poona there was a struggle for power between Reghunath Rao, the younger brother of Balaji Baji Rao, and Narayan Rao, the younger brother of Madhav Rao.
Narayan Rao was killed in 1773. He was succeeded by his posthumous son, Sawai Madhav Rao.
Out of frustration, Raghunath Rao approached to the British and tried to capture power with their help. This resulted in the First Anglo-Maratha War.
Sawai Madhav Rao died in 1795 and was succeeded by the utterly worthless Baji Rao II, son of Raghunath Rao.
The British had by now decided to put on end to the Maratha challenge to their supremacy in India.
The British divided the mutually-warring Maratha Sardars through clever diplomacy and then overpowered them in separate battles during the second Maratha War, 1803-1805, and the Third Maratha War, 1816-1819.
While other Maratha mates were permitted to remain as subsidiary states, the house of the Peshwas was extinguished.