Q&A · 2:09:59-2:11:30

Tea, silver, and the East India Company's opium trade

Tea was profitable, but paying China in silver created an incentive for the East India Company to obtain that silver through opium sales.

Question

If the tea trade was profitable, why did the East India Company sell opium to finance it?

Short answer

Tea and silk had to be bought with expensive silver. Selling comparatively cheap opium provided a way to obtain silver in China and pay for those exports.

Notes

The panel moves from the scale of nineteenth-century China to the commercial pressures behind Britain's opium trade. Tea and silk were profitable imports, but Chinese sellers demanded payment in silver. That requirement drew bullion toward China and made the trade costly for British interests. The East India Company used opium sales to obtain silver and finance the outward flow of tea. The passage frames the resulting conflict as a war fought to sustain the narcotics trade rather than suppress it.