After Tipu Sultan’s Mysore was captured by the British in 1799, the Marathas were the only major Indian power left outside of British domination.
Lord Wellesley, who came to India as the Governor General in 1798, wanted the Marathas to accept the subsidiary alliance. The Marathas refused to accept it.
Baji Rao II (son of Raghunathrao) was installed as the Peshwa after the death of Madhavrao II.
Yashwantrao Holkar, the chief of the Holkars of Indore defeated the Peshwas and the Scindias and was becoming powerful.
So Baji Rao II sought British protection and signed the Treaty of Bassein according to which he ceded territory to the British and agreed to the maintenance of British troops there.
All the other Maratha chiefs did not like European presence in their territory and saw the treaty of Bassein as a humiliation.
All the Maratha chiefs united against the British. But the British army, led by Wellesly, defeated the combined armies of Scindia and Bhonsle and finally they signed on to the subsidiary alliance system.
Finally, all other Maratha chiefs were defeated and one by one they signed on to the subsidiary alliance system.
