What is meant by ‘Trade Surplus’? Why did Britain have a trade surplus with India?

(a) When the value of exports is more than the value of imports, it is called ‘trade surplus’.
(b) Britain had a trade surplus with India because over the 19th century exports from India to Britain and the rest of the world increased. The value of British exports to India was much higher than the value of British imports from India. Thus, Britain had ‘Trade Surplus’ with India.
(c) Britain used this surplus to balance its trade deficits with other countries. In this way,
India helped not only Britain to maintain balance but also played a crucial role in the late nineteenth century world economy. Britain’s trade surplus in India also helped pay the so-called ‘home charges’ that included private remittances home by British officials and traders, interest payments on India’s external debt and pensions of British officials in India.

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