When the value of exports is higher than value of imports, it is called as ‘Trade Surplus’. (ii) Britain used this surplus to balance its trade deficits with other countries - that is. with countries from which Britain was importing more than it was selling to. (iii) This is how n multi-lateral settlement system works - it allows one country’s deficit with another country to be settled by its surplus with a third country. (iv) By helping Britain balance its deficits. India played a crucial role in the late- nineteenth century world economy. (v) Britain’s trade surplus in India also helped to 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.