Britain sold opium to China in return for the many Chinese commodities the British people craved as an alternative to using silver as a medium of exchange. The British had no domestic source of silver, whereas opium from Northeast India was available cheaply in large quantities from the British East India Company.
Goods such as porcelain, silk and tea drove Britain to trade with China. However, the Chinese had no interest in British manufactured goods and insisted on payment in silver. Because Britain had to buy silver from Europe and Mexico to finance its purchases of Chinese goods, the trade deficit became vast. Opium had been tolerated in China as a medicinal drug, but only in limited use. British opium was stronger than Chinese opium, and the Chinese began to smoke it instead of eating its resin, enhancing its effect. The Chinese government became alarmed as vast quantities of the drug began to be poured into the country by the British.
China's eventual ban on opium and destruction of opium supplies led to two major wars, called the Opium Wars, between the British and the Chinese. Both wars were overwhelmingly won by Britain and its European allies, forcing the Chinese to make trade concessions, allow foreign embassies in Peking, treat Chinese Christians equally, allow free passage of foreign ships up the Yangtze River, grant Britain parts of Kowloon and legalize the opium trade.