Pegu was a kingdom in the south of OTL Burma. Originally a part of Pagan, when in the 1430s: Inner conflicts in Pagan split the country in two halfs. One of them, the Pegu dynasty (from the city with the same name), asked Hong China for help, gaining control of the rest of OTL Burma. China's sphere of influence now borders India.
Their capital is called Hanthawaddy, also known in Thai as Hongsawadi.
In 1430, Hong China helps Pegu defeat the northern Burmese kingdom of Ava. The Ava royal family retreats into Bengal.
In 1638 (3335, Yang Earth Tiger in the Chinese calendar), the ruler of Pegu started an intrigue at the Hong court against Ayutthaya, gaining the emperor's favor. Pegu annexed the city of Tavoy from Ayutthaya.
In 1664, Pegu would lose the city of Tavoy to Ayutthaya in a war.
The Chinese, seeing that Pegu was speak at the moment invaded Pegu in 1666 and captured Ava, reinstalling the Ava royal family in.
In 1731, France founded the Indochinese League with Bengal, Pegu, Ayutthaya, Khmer, Champa and Melaka, thus strengthening the European influence in this area of the world.
1754: Pegu regained their strength and invaded Ava. The Chinese sent their numerically superior army to support Ava but Pegu defeated this Chinese army, routing it. After this, Pegu sacked Ava.
1758: Pegu invades and conquers Arakan
1761: Lanna surrenders to Pegu and becomes a vassal state
1768: Pegu invades Ayutthaya. After a long and costly siege, Pegu finally sacks the capital of Phra Nakhon Sri Ayutthaya in 1770.
1670: Seeing that Pegu was becoming too strong, China invades Pegu. Pegu withdraws their forces from Ayutthaya to defends against the Chinese invasion and despite have fewer troops, defeats the Chinese army. However, this victory was very costly. In the same year, Ayutthaya recaptures their capital but since Phra Nakhon Sri Ayutthaya was in ruins, they decided to move their capital to Bangkok
In 1776 (which was after French influence had ceased as France became a republic) Italy sent diplomats to Pegu, establishing a trade treaty.
In 1777, Pegu invaded Ayutthaya but was badly beaten back.
In 1778, Ayutthaya made a counter-invasion and marched into Burma. Their capital, Hanthawaddy (Known in Thai and Hongsawadi) was sacked by Siamese forces. However, the Burmese managed to group together a force that repelled the Siamese invaders.
Seeing that their capital was close to enemy borders, Pegu moved their capital to Mandalay, 20 km north of Ava