It is important as at that time, the British were looking to increase trade with China, an enormous market with its huge population. China then was an important exporter of tea, silk, spices and many other items which people in the West craved. China was, on the other hand, an importer of opium. Trade in these items would bring about handsome profits. To be able to get a foothold, an ideal settlement with a strategic location such as Singapore was needed. If the British lost out to the Dutch in this trade, the revenue that the British failed to earn would cost them financially dearly while the Dutch would made their presence felt in this region even more strongly than ever before.

At that time, the British already ruled much of India and controlled Penang and Bencoolen. When Raffles landed in Singapore, he found this an ideal spot...