Background

After the death of Madhavrao in 1772, his brother Narayanrao succeeded him as the fifth peshwa. However, Narayanrao’s uncle, Raghunathrao, had his nephew assassinated and named himself as the next peshwa, although he was not a legal heir. Narayanrao’s widow, Gangabai, gave birth to a son after her husband’s death. The newborn infant was named ‘Sawai’ (One and a Quarter) Madhavrao and he was legally the next peshwa. Twelve Maratha chiefs (Barabhai), led by Nana Phadnavis, made an effort to name the infant as the new peshwa and rule for him as regents.

Treaties of Surat and Purandhar Raghunathrao, unwilling to give up his position in power, sought help from the English at Bombay and signed the Treaty of Surat in 1775. Under the treaty, Raghunathrao ceded the territories of Salsette and Bassein to the English along with a portion of the revenues from Surat and Bharuch districts. In return, the English were to provide Raghunathrao with 2,500 soldiers. The British Calcutta Council, on the other side of India, condemned the Treaty of Surat (1775) and sent Colonel Upton to Pune to annul it and make a new treaty (Treaty of Purandhar, 1776) with the regency renouncing Raghunath and promising him a pension. The Bombay government rejected this and gave refuge to Raghunath. In 1777, Nana Phadnavis violated his treaty with the Calcutta Council by granting the French a port on the west coast. The English retaliated by sending a force towards Pune.