Agrarian crisis in Mughal India began around mid 17th century. As the economy of Mughal Dynasty was largely dependent on agriculture and on the revenues collected from peasant agriculture, the crisis of the empire strongly had agrarian roots. Several events marked the agrarian crisis of Mughal India. The Mughal Dynasty covered a whole subcontinent, united under a highly centralised administration. It owed its great success to the development of fire-arms that has been regarded as the underlying cause of the formation of the great Asian empires of the 16th century. Their main strength formerly lay in their cavalry and it was in the battle in the open field, and in rapid movements, that they remained invincible. The chief responsibility of the mansabdars was the maintenance of cavalry contingents with horses of standard breeds. There was, therefore, an intimate connexion between the military power of the Mughals and the system of jagirs or territorial assignments by which the mansabdars and their contingents were maintained.

As Mughal Emperor Akbar forged the main features of the assignment and mansab system, and systematised provincial administration, he gave shape to a centralised apparatus through which an absolute monarchy could function. As a result there was one great struggle in protest from one section of the nobility that was the revolt of 1580. The major agitations were caused by the wars of succession. There were stresses and strains within the various ethnic and caste elements forming the Mughal nobility; and Aurangzeb`s policy of religious discrimination possibly contributed to the Rajput revolt of 1679-80. The assignment system under the Great Mughals necessarily presupposed the preponderance of a particular type of economic order.

The unity and cohesion of the ruling class in Mughal India found its practical expression in the absolute power of the emperor. Further, the rate of the land revenue demand and the methods by which it was to be assessed and collected were all prescribed by the imperial administration. The emperor also decreed what other taxes were to be collected. Imperial revenue policies were shaped by two basic considerations. Firstly, since military details were maintained by the mansabdars out of the revenues of their jagirs, the tendency was to set the revenue demand so high as to secure the greatest military strength for the dynasty. However, secondly, it was clear that if the revenue rate was raised so high as to leave the peasant not enough for his survival, the revenue collections would definitely soon fall in absolute terms. The revenue demand as set by the authorities was thus designed to approximate to the surplus produce, leaving the peasant just the barest minimum needed for survival.

It was this appropriation of the surplus produce that created the great wealth of the Mughal ruling class. The contrast was accordingly striking between the rich class and the common people. The imperial administration did strive to set a limit to the revenue demand. But there was an element of contradiction between the interests of the imperial admiration and the individual Jagirdar. During the reign of Jahangir the peasants were so cruelly and pitilessly oppressed that the fields remained unsown and grew into wildernesses. Owing to the constant and unpredictable transfers of jagirs, late in Aurangzeb`s reign, the agents of the jagirdars had given up the practice of helping the peasantry. When the jagirdars, instead of appointing their own agents to collect the revenue, farmed out the jagir, the conditions deteriorated. Thus, from these accounts, it becomes quite clear that in the seventeenth century the belief had become deep-rooted that the system of jagir transfers led inexorably to a reckless exploitation of the peasantry. Some jagirdars of Gujarat were trying to extort more than the whole produce in revenue by the simple expedient of estimating the yield at two and a half times the actual one. Aurangzeb`s order prohibiting the imposition of numerous taxes by the jagirdars proved largely ineffective. All these incidents resulted in a huge agrarian crisis in the Mughal period.