Al Khalifa ascendancy to Bahrain and their treaties with the British

In 1797, fourteen years later after gaining the power of the Bani Utbah, the Al Khalifa family moved to Bahrain and settled in Jaww, later moving to Riffa. They were originally from Kuwait having left in 1766. Al-Sabah family traditions relates that the ancestors of their tribe and those of the Al-Khalifa tribe came to Kuwait after their expulsion from Umm Qasr upon Khor Zubair by the Turks, an earlier base from which they preyed on the caravans of Basra and pirated ships in the Shatt al-Arab waterway.[39]

In the early 19th century, Bahrain was invaded by both the Omanis and the Al Sauds. In 1802 it was governed by a twelve year old child, when the Omani ruler Sayyid Sultan installed his son, Salim, as Governor in the Arad Fort.[40]

In 1820, the Al Khalifa tribe regained power in Bahrain and entered a treaty relationship with Great Britain, by then the dominant military power in the Persian Gulf. This treaty granted the Al Khalifa the title of Rulers ("Al-Hakim" in Arabic) of Bahrain.

After Egyptian ruler Mohammad Ali Pasha took the Arabian Peninsula from the Wahhabis on behalf of the Ottoman Empire in 1830, Sheikh Abdul Al Khalifa declared allegiance to the Iranian Government to avoid the Egyptians taking control of Bahrain.

In 1860, the Government of Al Khalifa used the same tactic when the British tried to overpower Bahrain. Sheikh Mohammad bin Khalifa Al Khalifa wrote a letter to Nasseredin Shah of Iran declaring himself, his brother and all of members of Al Khalifa and the people of Bahrain Iranian subjects. In another letter to the Iranian Foreign Minister, Sheikh Mohammad demanded that the Government of Iran provide direct guidance and protection from British pressure.

Later on, under pressure from Colonel Sir Lewis Pelly, Sheikh Mohammad requested military assistance from Iran, but the Government of Iran at that time had no ability to protect Bahrain from British aggression. As a result the Government of British India eventually overpowered Bahrain. Colonel Pelly signed an agreement with Sheikh Mohammad in May 1861 and later with his brother Sheikh Ali that placed Bahrain under British rule and protection.

In 1868, following the Qatari–Bahraini War, British representatives signed another agreement with the Al Khalifa rulers, making Bahrain part of the British protectorate territories in the Persian Gulf. This treaty was similar to those entered into by the British Government with the other Persian Gulf principalities. It specified that the ruler could not dispose of any of his territory except to the United Kingdom and could not enter into relationships with any foreign government without British consent. In return the British promised to protect Bahrain from all aggression by sea and to lend support in case of land attack. More importantly the British promised to support the rule of the Al Khalifa in Bahrain, securing its unstable position as rulers of the country. Other agreements in 1880 and 1892 sealed the protectorate status of Bahrain to the British.

According to School of Oriental and African Studies (SOAS) academic, Nelida Fuccaro:

    From this perspective state building under the Al Khalifa shayks should not be considered exclusively as the result of Britain's informal empire in the Persian Gulf. In fact, it was a long process of strategic negotiation with different sections of the local population in order to establish a pre-eminence of their particularly artistic Sunni/Bedouin tradition of family rule.
    —Nelida Fuccaro, Persians and the space in the city in Bahrain 1869–1937[41]

Unrest amongst the people of Bahrain began when Britain officially established complete dominance over the territory in 1892. The first revolt and widespread uprising took place in March 1895 against Sheikh Issa bin Ali, then Ruler of Bahrain. Sheikh Issa was the first of the Al Khalifa to rule without Iranian relations. Sir Arnold Wilson, Britain's representative in the Persian Gulf and author of The Persian Gulf, arrived in Bahrain from Mascat at this time. The uprising developed further with some protesters killed by British forces.

Peace and trade brought a new prosperity to Bahrain. With the country no longer dependent upon pearling, by the mid-19th century it became the pre-eminent trading centre in the Persian Gulf, overtaking rivals Basra, Kuwait, and finally, in the 1870s, Muscat.[42] At the same time, Bahrain's socio-economic development began to diverge from the rest of the Persian Gulf undergoing transformation from a tribal trading centre to a modern state.[43] This process was spurred by the arrival of large numbers of Persian, Huwala, and Indian merchant families who set up businesses on the island, making it the hub of a web of trade routes across the Persian Gulf, Persia and the Indian sub-continent. A contemporary account of Manama in 1862 found:

    Mixed with the indigenous population [of Manamah] are numerous strangers and settlers, some of whom have been established here for many generations back, attracted from other lands by the profits of either commerce or the pearl fishery, and still retaining more or less the physiognomy and garb of their native countries. Thus the gay-coloured dress of the southern Persian, the saffron-stained vest of Oman, the white robe of Nejed, and the striped gown of Bagdad, are often to be seen mingling with the light garments of Bahreyn, its blue and red turban, its white silk-fringed cloth worn Banian fashion round the waist, and its frock-like overall; while a small but unmistakable colony of Indians, merchants by profession, and mainly from Guzerat, Cutch, and their vicinity, keep up here all their peculiarities of costume and manner, and live among the motley crowd, ‘among them, but not of them’.
    —WG Palgrave, Narrative of a Year's Journey through Central and Eastern Arabia (1862–3)[44]

Palgrave's description of Manama's coffee houses in the mid-19th century portrays them as cosmopolitan venues in contrast to what he describes as the ‘closely knit and bigoted universe of central Arabia’.[44] Palgrave describes a people with an open – even urbane – outlook: "Of religious controversy I have never heard one word. In short, instead of Zelators and fanatics, camel-drivers and Bedouins, we have at Bahrain [Manama] something like 'men of the world, who know the world like men' a great relief to the mind; certainly it was so to mine."[44]

The great trading families that emerged during this period have been compared to the Borgias and Medicis[44] and their great wealth – long before the oil wealth the region would later be renowned for – gave them extensive power, and among the most prominent were the Persian Al Safar family, who held the position of Native Agents of Britain in 19th century.[44] The Al Safar enjoyed an 'exceptionally close'[44] relationship with the Al Khalifa clan from 1869, although the Al-Khalifa never intermarried with them – it has been speculated that this was to limit the Al-Safars' influence on the ruling family or because the Al-Safars were Shia Muslims.

Bahrain's trade with India saw the cultural influence of the subcontinent grow dramatically, with styles of dress, cuisine, and education all showing a marked Indian influence. According to Exeter University's James Onley "In these and countless other ways, eastern Arabia's ports and people were as much a part of the Indian Ocean world as they were a part of the Arab world."[44]

In 1911, a group of Bahraini merchants demanded restrictions on the British influence in the country. The group's leaders were subsequently arrested and exiled to India. In 1923, the British deposed Sheikh Issa bin Ali whom they accused of opposing Britain and set up a permanent representative in Bahrain. This coincided with renewal of Iran's claim over the ownership of Bahrain, a development that Sheikh Issa had been accused of welcoming. The preference shown by the people of Bahrain towards the renewal of Iran ownership's claim also caused concern for Britain. To remedy these problems, in 1926, Britain dispatched Sir Charles Belgrave, one of her most experienced colonial officers, as an advisor to the Ruler of Bahrain. His harsh measures intensified the increasing aversion of people towards him and led to his eventual expulsion from Bahrain in 1957. Belgrave's colonial undertakings were not limited to violent deeds against Bahrainis but also included a series of initiatives that included removal of Iranian influence on Bahrain and the Persian Gulf. In 1937, Belgrave proposed changing the name of the Persian Gulf to the "Gulf of Arabia", a move that did not take place.

In 1927, Rezā Shāh demanded the return of Bahrain in a letter to the Allied Nations Community.[clarification needed "League of Nations?"] Britain believed that weakened domination over Bahrain would cause her to lose control all over the Persian Gulf, and decided to bring uprisings amongst the people of Bahrain under control at any cost. To achieve this they encouraged conflicts between Shiite and Sunni Muslims in Bahrain[citation needed].

Bahrain underwent a period of major social reform between 1926 and 1957, under the de facto rule of Charles Belgrave, the British advisor to Shaikh Hamad ibn Isa Al Khalifa (1872–1942). The country's first modern school, the Al-Hiddaya Boys School, was established in 1919, whilst the Arab Persian Gulf's first girls' school opened in 1928. The American Mission Hospital, established by the Dutch Reformed Church, began work in 1903. Other reforms included the abolition of slavery. At the same time, the pearl diving industry developed at a rapid pace.

These reforms were often vigorously opposed by powerful groups within Bahrain including sections within the ruling family, tribal forces, the religious authorities and merchants. In order to counter conservatives, the British removed the Ruler, Isa ibn Ali Al Khalifa in 1923 and replaced him with his son. Some Sunni tribes such as the al Dossari left Bahrain to mainland Arabia, whilst clerical opponents of social reforms were exiled to Saudi Arabia and Iran. The heads of some merchant and notable families were likewise exiled[citation needed]. Britain's interest in Bahrain's development was motivated by concerns over the ambitions of the Saudi-Wahabi and the Iranians.