In the aftermath of the Battle of Bhopal, where the Maratha forces secured a crucial victory against the Rajput army, Peshwa Bajirao I and Jai Singh II entered into negotiations to formalize a peace treaty. The battle was significant, as it showcased the military prowess of the Marathas, marking their predominant role in the Indian subcontinent during the early 18th century. The treaty signified more than just a cessation of hostilities; it represented a critical turning point in the regional power dynamics that were in flux at the time.

Jai Singh II, a prominent Rajput leader and a major figure in the Mughal court, recognized the need for diplomacy with the Marathas after suffering defeat. The resultant treaty established terms that allowed both parties to coexist amicably, while simultaneously ensuring that the Marathas would not encroach upon territories controlled by Jai Singh. This was a shrewd move by Bajirao to secure the Maratha position in northern India and stabilize relations with influential Rajput states.

The peace treaty not only ended the immediate conflict but also laid the groundwork for future alliances and rivalries in the subcontinent. It is essential to note that while this treaty brought peace, it also illustrated the complexities and shifting allegiances in pre-colonial India, setting the stage for the continuing power struggles between the Marathas, Rajputs, and the Mughal Empire as they vied for dominance in the region.