The visible decline of the empire can be dated from 1712, the year of the death of Bahadur Shah 1. But it remained an apparently imposing institution until the I750s, and few thought its doom inevitable before then. The first stage in the process was succession wars which left a puppet in the hands of kingmakers. The kingmakers overreached themselves when the third choice proved a clever youth who disposed of them in the course of two Years.
This youth was Muhammad Shah, who reigned for twenty-nine years until 1748. The twenties saw the next stage when the empire was virtually divided into two. Asaf Jah, Nizam-ul-mulk, baulked in his reforming intentions as chief minister in Delhi, went back to his Deccan provinces and became the virtually independent ruler of the southern half of the Mughal empire with Hyderabad as its capital.
The empire bad crushed the Sikhs in 1716, but it found itself helpless against the Marathas. In 1738 the Marathas plundered the suburbs of Delhi and dictated a peace which divided the two halves of the empire by the cession of the province of Malwa. In 1739 came the humiliation of the Persian King Nadir Shah's invasion. Neglect, ineptitude, divided counsels, and treachery led to military debacle at Karnal, the occupation of Delhi, massacre, and wholesale plunder. Nevertheless, when Nadir Shah's back was turned, with the Peacock Throne in his train, the empire seemed to recover and even repelled the first of the Afghan incursions in 1748. With Muhammad Shah's death the collapse began. A civil war between rival ministers left a headlong and ruthless youth in power, who murdered two emperors and called in the Marathas before vanishing into obscurity. The south was already the Nizam's domain. Kabul was lost to Nadir Shah in 1739. Sindh and fertile Gujarat with Surat went in 1750, prosperous Oudh in 1754, and the martial Punjab to the Afghans in the same year. Bengal still sent tribute but was virtually independent.
The cause of this collapse is usually put down to the effeteness of the emperors. This was certainly one cause since personality was one of the main imperial pillars. But it was not the only cause or necessarily the vital one. Another important reason was Aurangzeb's policy of treating the empire as a Muslim state instead of an Indian state with Islam as the state religion. Which alienated Hindus to such an extent that they had no desire of allowing Mughal empire to continue. Martial groups like the Sikhs and the Jats were encouraged to open revolt. And the Marathas with their invincibility and Guerrilla warfare had all the capabilities to ruin the Mughals and form another empire.
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