Economists identify three types of flows within international economic exchange:

1. The Flow of Trade: This refers to the exchange of goods. For India, a classic example was the export of raw cotton to Britain during the nineteenth century. India's weavers were devastated by the import of cheap, machine-made British textiles, while the country became a key supplier of the raw material needed for Britain's mills.

2. The Flow of Labour: This involves the migration of people in search of employment. The migration of indentured labourers from India to the Caribbean, Mauritius, Fiji, and other parts of the British Empire in the nineteenth and early twentieth centuries is a prime example. Millions were sent to work on plantations under harsh conditions.

3. The Flow of Capital: This refers to the movement of money for short-term or long-term investments. An example for India was the investment by British firms in infrastructure projects like railways, telegraphs, and irrigation. While this facilitated colonial control and trade, British bankers also made significant loans to the colonial government and businesses operating in India, controlling much of the external capital flow.