The internal problems of the Marathas and the growing ambition of the English brought the beginning of the Anglo-Maratha struggle. The primary cause of the first Maratha war was the interference of the English government at Bombay in the internal affairs of the Marathas.Peshwa Madhav Rao died in 1772 and was succeeded by his younger brother Narain Rao.His uncle Raghoba wanted to become the Peshwa and got him murdered. The Maratha chiefs took up the cause of Madhav Rao Narain the son of Narain Rao.Ragobha approached British for help and signed the treaty of Surat hopping to gain the coveted Gaddi with the help of English subsidiary troops. By this treaty he also promised to cede Salsette and Bassein and refrain from entering into alliance with the enemies of the company.
In the war that followed nobody gained any success and two parties realized the futility of the struggle by concluding the Treaty of Salbai (1782). By the Treaty of Salbai, status quo was maintained which gave the British 20 years of peace with the Marathas. The treaty also enabled the British to exert pressure on Mysore with the help of the Marathas in recovering their territories from Haider Ali.