n the early 18th century, the Al Abu Falasa clan of
Bani Yas clan established Dubai, which remained a dependent of Abu Dhabi until 1833.
[14] On
8 January 1820, the
sheikh of Dubai and other sheikhs in the region signed the "General Maritime Peace Treaty" with the British government.
[15] However, in 1833, the Al Maktoum dynasty of the Bani Yas tribe left the settlement of Abu Dhabi and took over Dubai from the Abu Fasala clan without resistance.
[14] Dubai came under the protection of the
United Kingdom by the "Exclusive Agreement" of 1892, with the latter agreeing to protect Dubai against any attacks from the
Ottoman empire.
[14] Two catastrophes struck the town during the mid 1800s. First, in 1841, a
smallpox epidemic broke out in the
Bur Dubai locality, forcing residents to relocate east to
Deira. Then, in 1894, fire swept through Deira, burning down most homes.
[16] However, the town's geographical location continued to attract traders and merchants from around the region. The emir of Dubai was keen to attract foreign traders and lowered trade tax brackets, which lured traders away from Sharjah and
Bandar Lengeh, which were the region's main trade hubs at the time.
[17][16] Dubai's geographical proximity to
India made it an important location. The town of Dubai was an important port of call for foreign tradesmen, chiefly those from India, many of whom eventually settled in the town. The town was known for its pearl exports until the 1930s. However, Dubai's pearling industry was damaged irreparably by the events of the
First World War, and later on by the
Great Depression in the late 1920s. Consequently, the city witnessed a mass migration of people to other parts of the Persian Gulf.
[10] Since its inception, Dubai was constantly at odds with Abu Dhabi. In 1947, a border dispute between Dubai and Abu Dhabi on the northern sector of their mutual border, escalated into war between the two states.
[18Arbitration by the British and the creation of a buffer frontier running south eastwards from the coast at Ras Hasian resulted in a temporary cessation of hostilities.
[19] However, border disputes between the emirates continued even after the formation of the UAE; it was only in 1979 that a formal compromise was reached that ended hostilities and border disputes between the two states.
[20] Electricity, telephone services and an airport were established in Dubai in the 1950s, when the British moved their local administrative offices from
Sharjah to Dubai.
[21] The town joined the newly independent country of
Qatar to set up a new monetary unit, the
Qatar/Dubai Riyal, after the
deflation of the
Gulf rupee.
[13] Oil was discovered in Dubai the same year, after which the town granted concessions to international oil companies. The discovery of oil led to a massive influx of foreign workers, mainly Indians and Pakistanis, into the city. As a result, the population of the city from 1968 to 1975 grew by over 300%, by some estimates.
[22] On 2 December 1971 Dubai, together with Abu Dhabi and five other emirates, formed the United Arab Emirates after former protector Britain left the Persian Gulf in 1971.[23] In 1973, Dubai joined the other emirates to adopt a single, uniform currency: the UAE dirham. In the 1970s, Dubai continued to grow from revenues generated from oil and trade even as the city saw an influx of Lebanese immigrants fleeing the civil war in Lebanon.[24] The Jebel Ali Free Zone, comprising the Jebel Ali port (reputedly the world's largest man made port) was established in 1979, which provided foreign companies unrestricted import of labour and export capital.[25]
