Why was cotton an important raw material for the British Empire?
There was huge demand for cotton fabrics across the world. Before the Industrial Revolution, India was the dominant producer; it spun and wove the largest quantity and the highest quality of cotton. Europeans, including the British, wanted to access these fabrics, and sell them into Southeast Asian, African and European markets. Europeans eventually tried to manufacture them as well. By the latter half of the 18th century, they found ways to produce them less expensively with machines that made spinning and weaving of cotton more productive. Still, quality-wise, Indian artisans were way ahead.

How did the Industrial Revolution change things?
After 1780, with the arrival of the Industrial Revolution, the cotton industry became the United Kingdom's most important industry. It employed the largest number of workers and produced the most significant share of its export trade. But cotton did not grow in the UK, and hence had to be sourced from elsewhere. Before the Industrial Revolution, small quantities had arrived from India, Africa and the Caribbean. But with the advent of machine production, Britain (and other European nations) needed more cotton. By 1800, they relied on the slave plantations of the US but when it ended in 1865, Indian cotton emerged as the frontrunner. Cotton was crucial to Europe's industrial prosperity and social stability.