A face that many of the people may not know today is that long before the UAE used dirhams, the currency that was used in the UAE was the Gulf rupee.
The founder of “Numisbing” Ramkumar said “Before the story of oil, there was no currency system in the UAE like there was in other developed nations."
Before the dirham was born, different types of currencies were used in the Trucial States.
Ramkumar explained how the alliance with the British, the Trucial States used the currency of the largest nation, which was nearest to them. This happened to be India, which was under the rule of British during that time.
It was very usual for many countries to use the Indian currency ‘rupee’ as their currency. Ramkumar said that at a point there were as many as 20 countries using Indian rupee as their currencies in different parts of the world.
Until the year 1957, all the currency notes, which were used in India, were used in the Trucial States.
But, the things began to change, when few issues arose. Many trades were smuggling large quantities of gold from the UAE to India, because Gold was cheaper there than it was in India and many traders started taking advantage of that fact
Then in 1957 India started printing special notes ‘External rupees’ or ‘Gulf rupees’ for circulation in the Gulf countries. The special notes were introduced to curb the gold smuggling that was happening in the region
Ramkumar said notes of Rs.1, Rs.5, Rs.10, and Rs.100 came into denominations, in addition to the Trucial States, the other Gulf Cooperation Council (GCC) countries like Bahrain, Kuwait, Oman, and Qatar also used these currencies; the only country that did not use ‘rupee’ was Saudi Arabia
Now, a person couldn't purchase any gold in the Trucial States with Indian rupees because they were not the legal tender. In addition, you couldn't use the Gulf rupees in India for the very same reason."
Ramkumar said, for any person in India who was interested in trading in the UAE during this period, they would have to exchange their Indian rupees at the office of issue in Bombay
He also said from the year 1957 to 1966 Gulf rupee was in circulation in the UAE, but in 1966 India devalued its currency and by that time oil was discovered in the Trucial States.
History being made between India and UAE
AMandeep
