He was installed as a puppet ruler by the Maratha nobles, whose growing power prompted him to flee his capital Poona and sign the Treaty of Bassein (1802) with the British.

After suffering several battle defeats, the Peshwa surrendered to the British, and agreed to retire in return for an estate at Bithoor and an annual pension.

Baji Rao II had to carry the unfortunate legacy of his parents who, despite being from the same Brahmin family, were suspected of being involved in the murder of the young fifth Peshwa Narayanrao in 1774.

On 13 June 1817, the Company forced Baji Rao II to sign an agreement renouncing claims on Gaekwad's revenues and ceding large swaths of territory to the British.

[14][15] On 5 November 1817, the British Resident at Poona was attacked by Baji Rao II's army led by his Attorney Mor Dixit.

Towards the end of December, Colonel Burr received news that the Peshwa intended to attack Pune, and asked the Company troops stationed at Shirur for help.

[20] Five British columns set out after Baji Rao II in full cry, slavering at the thought of the 'prize money' that lay at the end of the chase.

After running for five months from one fort to another, awaiting the promised help from Scindias, Holkars, and Bhosles that did not come, Baji Rao II surrendered to Sir John Malcolm.

[23] To keep Baji Rao II under watchful eyes, the British selected a small village on the right bank of the Ganges at a place called Bithur near Kanpur, where they had a large military establishment then.

In order to get rid of the ghost, Baji Rao employed the priests of Pandharpur, a temple town of Maharashtra on the banks of the Chandrabhaga.

[25] Initially, the priests succeeded in driving away the ghost and in gratitude, Baji Rao II ordered the building of a riverside embankment in Pandharpur, which still bears his name.

Since he was forbidden to visit his homeland, he performed religious penances prescribed by the priests of Benares (Varanasi) and was extravagant in distributing alms to Brahmins.

He built temples, bathing ghats, performed endless poojas (religious prayers), underwent countless stringent fasts, fell at the feet of sadhus and soothsayers, etc., but the ghost would not leave him.

[26] Incidentally, after the flare-up of the Indian Rebellion of 1857, Company troops, in July that year, after their successful re-capture of Kanpur under Major-General Henry Havelock initially and later under the then Brigadier James Hope Grant, sacked and burnt down Bithur, including the residence (wada) of Baji Rao II, where many members of his extended family except his adopted son, Nana Sahib, resided.