Page 179 - DILMUN NO 20

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Historical Links between lndia and the Gu‫ﺇ‬f

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Annual trade reports in the period under study evidently show that the Gu‫ق‬f's
imports from lndia increased or decreased, in range and volume, in
accordance with the rise or decline of pearl prices, What probably facilitated
the conduct of Business between the two regions was the existence of a
common means of payment, the indian rupee. ln fact, dependency of the Gulf
merchants on the lndian market for the sale of their pearls contributed to the
emergence of the lndian rupee as the major currency in circulation in the
Gulf. 58 This continued until 1959 when the lndian Government, under
economic pressures caused by continuous smuggling of gold into its
territories against obtaining lndian rupees, issued the 'Gulf rupee' as a
special currency for the use in the Gulf states. 59 The Gulf rupee, which was
at parity with the lndian currency, remained the official means of payment in
these states until they issued their own currencies in the early 1960s. lndia's
Role in Enriching the Gul's Merchant Houses

lt was through establishing business with lndia or in lndia at this time that
many of today's prominent merchant families in the Gulf made the first
portions of their great wealth. The business histories of these families reveal
interesting stories about their early modest beginnings and the role of the
indian connection in their riches. ١n Kuwait, for example, the head of
Alghanim business empire began his business, which has vastly developed
in the last four decades under his sons and grandsons, by plying the Basra­
Bombay route selling lraqi dates to the indians and buying from india food,
cloth, and timber on return to Kuwait. 60

The wealth of some of the most prominent Saudi merchant families, like
A0irezaand Algosaibi, was basically attributed to their decisions in the late
19th and early 20th centuries to establish purchasing offices in Bombay and
Calcutta through which they sold pearls and exported an assortment of
lndian commodities to Jeddah, Bahrain, and Alahsa. Establishing such
offices did not only give them a foothold in the lndian commodities market
and advantage over other Arab merchants, whose contact with lndia was
confined to occasional visits, but also gave them opportunities to win
contracts to represent lndian companies in the Gulf such as the Bombay and
Persia Steam Navigation Company which held monopoly of the pilgrim traffic
between india and Arabia, 61