Ruler of Mysore
After overthrowing Khande Rao, Hyder Ali founded the Sultanate of Mysore and formally styled himself Sultan Hyder Ali Khan in his correspondence with the Mughal Emperor Shah Alam II. He was very cautious in his diplomacy with the Nizam of Hyderabad, who was, according to an official Mughal firman, the sovereign of all Muslim-ruled territories in southern India.
On the Malabar Coast, Ali Raja Kunhi Amsa II had established a large and well armed fleet consisting of 10 dhows and 30 larger ketches in the Indian Ocean, in his attempts to conquer islands that had withstood the Mughal Emperor Aurangzeb. In 1763 his fleet sailed from Lakshadweep and Cannanore carrying on board sepoys and on its pennons the colors and emblems of Hyder Ali, and captured the Maldives, enacting cruelties upon fellow Muslims who inhabited the islands. Ali Raja returned to Mysore to pay homage to Hyder Ali, presenting him the captured Sultan of the Maldives Hasan 'Izz ud-din, whom Ali Raja had blinded. Outraged at this excess, Hyder Ali stripped Ali Raja of the command of his fleet.
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