Question

what do you understand by drain of wealth how it helped in expansion of East India company?​

Answer 1

Answer:

In the mercantilist concept an economic drain takes place if gold and silver flow out of the country as a consequence of an adverse balance of trade. In the 50 years before the battle of Plassey, the East India Company had imported bullion worth £ 20 million into India to balance the exports over imports from India.

Answer 2

Answer:

Drain of wealth means that economic policies of the British in India were primarily motivated to snatch maximum benefits from India's trade. India's foreign trade generated large export surplus. This export surplus did not result in any flow of gold or silver into India.