addressing an Indian community gathering in Dubai Cricket Stadium in August 2015. Countries in the
Persian Gulf region have had a long-established economic and political link with India. The
Trucial Oman (now the
UAE) was
nominally independent in the 19th century but was administered by the
British Raj; trade and banking sectors in the territory were administered by the
Khoja and
Kutchi communities of India. In 1853, the rulers of the emirates signed a
Perpetual Maritime Truce with the British, effectively bringing the region under Britain's sphere of influence. Administered from British India, the emirates developed commonalities with
South Asia.
Indian Rupees were used as currency, as were Indian
stamps (overlaid with the name of the emirate) for postal correspondence. A fairly homogeneous society at the turn of the 20th century, the region that now comprises the UAE experienced an economic boom as a result of the
pearling industry; the few Indian traders emigrating to the emirates moved to the coastal towns and remained on the fringes of
Emirati society. Dubai had traditionally served as an
entrepôt for trade between the
Middle East and the
Indian subcontinent and was dominated by Indian merchants in gold and textile trades. Dubai was also an important trading post for Indians prior to the discovery of oil (in commercial quantities) in the UAE in 1959;
Indian footprint on UAE economy Businesses in the largest sheikhdoms in the UAE, Dubai and Abu Dhabi continued to use the Indian Rupee even after India's
independence in
1947. But its popularity strained India's
foreign reserves, and so in 1959 the
Indian government created the
Gulf rupee, initially at par with the Indian rupee. It was introduced as a replacement for the Indian rupee for circulation exclusively outside the country, which included apart from the states making up the UAE, the nations of
Kuwait,
Qatar,
Oman and
Bahrain. On 6 June 1966, India devalued the Gulf rupee against the Indian rupee. Following the devaluation, several of the states still using the Gulf rupee adopted their own currencies.
Immigration boom The discovery of oil brought with it an influx of workers from India from the mid-1960s onward. Many came via sea, a trip of about three days from
Bombay (now Mumbai) to Dubai. Most of the shopkeepers were from the
state of
Kerala, or were Indian Arabs, descendants of Arabs who had previously emigrated to India. Indian migration to the UAE drastically increased in the 1970s and 1980s, with the expansion of the oil industry and the growth of
free trade in Dubai. Annual migration of Indians to the UAE, which stood at 4,600 in 1975, rose to over 125,000 by 1985, and stood at nearly 200,000 in 1999. == Demographics ==