Siddiqi met the boy in Glasgow's St Enoch Centre during the school summer holidays in 2025 and asked if he "wanted to start making money".
The boy initially refused as he believed the dealer was talking about drugs.
But the High Court in Glasgow heard Siddiqi eventually persuaded the child to team up with him by suggesting he could use the cash to help his mother.
The youngster was given Siddiqi's Instagram account and later a mobile phone.
The boy lied to his mum that he had a "summer holiday camp" to go to after Siddiqi messaged him, and in mid-July the teenager was taken to a known drug den in Glasgow.
He ended up staying there for a number of days and was shown how to "bag up" crack cocaine.
Prosecutor Jennifer Nicholson-White said: "Siddiqi would attend the flat for only a couple of hours each day due to having an electronic tag. He would give the boy £20 to buy food."
The child was then taken by taxi to a dirty, rubbish-strewn property in Paisley in Renfrewshire.
He was told to hand out "testers" to local addicts - small samples of cocaine.
The boy ended up staying at the flat for the rest of the week.
The prosecutor said the child handed out about 60 testers and was given the phone numbers of drug users.
She added: "He estimated Siddiqi made about £700 each day in sales."
His mother was "distraught" on being told the truth, the court heard.
The boy was referred to the Home Office National Referral Mechanism and it was concluded he had been a "victim of exploitation".
Siddiqi was spotted by police in Glasgow's Castlemilk area on 19 September, where he was clutching two phones and seemed "nervous".
He tried to run off from officers but was caught. One constable was badly hurt during a struggle, suffering shoulder ligament damage.
Police seized almost £3,000 of heroin on him, which had fallen out of his jacket during the tussle with police.
Siddiqi complained that he had also been "exploited".
A number of offenders have been convicted under the Human Trafficking Act, but this case is thought to be one of the first involving a child being exploited to deal class A drugs for financial gain.
Siddiqi also admitted in court to being concerned in the supply of heroin and cocaine as well as the aggravated assault of the police officer.
A not guilty plea to preying on another teenage boy to sell drugs was accepted by prosecutors.
Callum Hiller, defending, said Siddiqi came from a good background and that others had also been "pressuring" him.
Lord Scott continued his remand in custody as sentencing was deferred for reports.
