First of all, I should point out that Buddhism does NOT recognize the Caste system. It does teach that one is reincarnated after death and ones station in life is dependent upon ones previous life; but there is not the strict social separation that exists under the Hindu system. Also, Buddhism is a missionary religion which actively seeks converts. Hinduism is not a missionary religion, which accounts for its being confined primarily to the Indian sub-continent. An earlier post discussed how similar the two religions are. I respectfully disagree.
There was actually very little political unity in India, in fact the country remained divided for almost fifteen hundred years, ruled largely by war lords and occasional emperors who were unable to establish a lasting dynasty. People were not necessarily willing to accept life as it comes, which accounts for the success of Buddhism. Since Buddhism rejected the caste system, it appealed to the lower castes and untouchables, and offered them real hope. Successive rulers in India were either Hindu or Buddhist, with varying degrees of tolerance; however the real political force came with the invasion of Islam. Both Buddhism and Hinduism were considered false religions, and mercilessly suppressed. To this day, Northern India and Pakistan is predominantly Muslim and Southern India predominantly Hindu. Although Buddhism was born in India, it is rarely practiced there.