The Peshwa's Crisis: Financial Collapse & Strategic Hesitation

Marathi History Book Reading Session Summary

The Maratha Defense Divided

Three-Army Problem:

• One Maratha army in Deccan defending against Nizam
• One large army at Panipat (under Bhau) fighting Abdali
• Peshwa attempting to raise a third army for northern reinforcement
• Massive resource drain across three simultaneous fronts

The Financial Reality:

• Empire has expanded territorially but drowning in debt
• Accumulating loans of 50 lakh rupees (500,000 rupees) for Abdali conflict alone
• Peshwa increasingly distracted and ill
• Not a natural warrior or strategist (lacks father's military mind)
• Facing mounting financial challenges alongside military crisis

Peshwa's Desperate Letter to Bhau (December 1760)

The Complaint:

• "Our wealth increased, that's why we expanded empire" (sarcastic)
• But now: "We owe crores of rupees in loans"
• Bitter irony: controlling more land but financially bankrupt
• Questions usefulness of controlling vast territory when drowning in debt

Specific Demands to Bhau:

• Sent 10-12 lakh rupees (100,000-120,000 rupees) already
• Taken loans of 15 lakh rupees (150,000 rupees) on his end
• Expects Nizam Ali to join (needs 3 lakh rupees—30,000)
• Brother Raghunath Rao's army: 15,000 soldiers (needs funding)
• Artillery: 15-20 lakh rupees (150,000-200,000 rupees)
• Total needed: 40 lakh rupees (400,000 rupees)
• Asking Bhau to send 5 lakh to Raghunath Rao and 5 lakh to himself

Peshwa's Movement Plans:

• Traveling via Burhanpur to reach Hindustan
• Planned for Marga (December-January)
• Brother Raghunath Rao recruiting Nizam Ali
• Plan was for Peshwa to reach Delhi with reinforcements

The Nizam Ali Betrayal

Nizam's Double Game:

• Technically allied with Marathas (treaty obligation to defend Mughal)
• Supposed to join Raghunath Rao and march north with him
• Required by treaty to protect Mughal empire against foreign invasion
• But understood geopolitical reality: if Marathas defeat Abdali, they dominate north

The Strategic Calculation:

• "Enemy of my enemy is my friend" logic
• If Marathas win Panipat, they become overwhelming power in north India
• If Abdali wins, Muslim power restored (better for Nizam's position)
• Either way, Marathas represented greater long-term threat to Nizam's independence
• Chose to hedge: didn't openly rebel but delayed and obstructed

The Delaying Tactic:

• Kept making excuses
• Delayed mobilizing his forces
• Never actually marched north with Raghunath Rao
• Forced Raghunath Rao to stay back in Deccan to monitor him
• Prevented reinforcements from reaching Bhau at critical moment

Net Effect:

• Peshwa lost ability to send promised north army
• Raghunath Rao stuck in Deccan watching Nizam
• No reinforcements reached Panipat
• Bhau left without expected support from south

The Peshwa's Paralysis

Physical & Mental Condition:

• Peshwa was sick/ill during this period
• Not naturally inclined to warfare or strategy
• Lacks his father's military genius and decisiveness
• Caught between wanting to help Bhau and handling home situation

Conflicting Priorities:

• Couldn't leave Deccan undefended against Nizam
• Needed to arrange southern defense before going north
• But if he stayed, Bhau wouldn't get reinforcements
• If he left, Nizam might attack Pune or Maratha heartland
• Impossible choice between two fronts

The Attempt:

• Originally planned to send Raghunath Rao north with Nizam
• Thought this would hold Nizam and provide reinforcements
• When Nizam delayed and refused, plan collapsed
• Raghunath Rao forced to remain as watchdog on Nizam

Intelligence from the Field

Contemporary Report (December 10, 1760): A Maratha letter writer in Deccan reported:

"Shrimanta (Peshwa) will head for Burhanpur. Bhau Sahib is in difficult situation. The Pathan of Dali (Abdali) and Bhau have skirmishes every day. News reports 20 days of daily battles. Both are equal so far. Bhau Sahib's courage is tremendous. He made Shinde and Holkar's army stand and give battle (despite their reluctance to fight). God will give success."

What This Shows:

• Daily skirmishes happening (not static siege)
• Bhau personally displaying courage and forcing reluctant commanders to fight
• Neither side had clear advantage yet (equal so far)
• Situation was ongoing struggle, not settled

Financial Breakdown

Maratha Expenditures Documented:

The Supply Chain to Bhau

Route Problems:

• Funds had to travel from Deccan to Panipat
• 1500 km distance through uncertain territory
• Had to avoid Abdali's interception
• Vulnerable at every stage

Example of Failure:

• Parashar Dadaji's courier mission (January 6) proves this
• 150,000+ rupees lost to ambush
• 2,000 soldiers killed/captured
• Shows how fragile financial lifelines were

Political Reality

The Deccan Hostage Situation:

• Peshwa couldn't leave Deccan undefended
• Nizam was technically ally but couldn't be trusted
• Had to keep Raghunath Rao there to monitor him
• Created forced division of Maratha strength

Why Nizam Wouldn't Commit:

• Treaty obligation didn't align with self-interest
• Mughal empire already dying/irrelevant
• Maratha victory = Maratha hegemony over all north
• Nizam's kingdom safer if powers balanced
• Better outcome: Abdali weakens Marathas, Nizam plays kingmaker

Timeline

Key Insights

The Structural Problem: Marathas controlled too much territory to defend. Protecting Deccan AND fighting Abdali AND trying to raise new armies was unsustainable.

The Financial Trap: Every rupee sent north was a rupee not available for defense/administration elsewhere. War with Abdali was becoming national mobilization—entire empire at risk.

The Nizam's Brilliance: Without directly betraying Marathas or breaking treaty, Nizam made sure they couldn't win. Delay and obstruction were more effective than open rebellion.

The Sick Peshwa: Unlike his father Balaji Bajirao (brilliant strategist), Nana Sahib lacked the mental/physical toughness to make hard choices. He wanted to help Bhau but couldn't sacrifice home defense.

The Missing Reinforcements: Bhau was expecting support from south that never came. The Peshwa's paralysis meant one army had to carry the entire war effort alone.

Where We Left Off: The Peshwa is paralyzed—too sick to fight, too distracted to lead, surrounded by financial crisis and the impossible choice between two fronts. Bhau won't get the reinforcements he was promised. The Nizam has effectively neutralized the southern Maratha armies through simple obstruction. As Bhau faces Abdali on January 14, he's entirely on his own. The empire is divided and the center is weak.

The Peshwa wanted to help. He really did. But he was sick, he wasn't a military man, and he was drowning in debt. Every letter to Bhau was basically: "I want to send help but I need more money, and I don't have it." Meanwhile the Nizam played it perfectly—didn't rebel, just delayed, didn't fight, just obstructed. By the time Peshwa realized what was happening, it was too late. Raghunath Rao was stuck in Deccan, no third army materialized, and Bhau was facing Abdali alone. The weakness at the center had doomed the armies in the field.