Bahrain was once viewed by ancient Sumerians as an island paradise to which the wise and brave were taken to savour eternal life. During the 15th and 16th centuries, the Gulf began to open up to European traders and Bahrain was under Portuguese rule between 1521 and 1622. For more than 100 years, Bahrain was attacked by various tribes and national groups until the al-Khalifa clan took control of the island. The clan sought the protection of the British and between 1861 and 1971, Bahrain was a British Protectorate – nominally independent but with the British in charge of foreign and security policy. A 1913 agreement between the British and the Ottoman empire confirmed its position within Britain’s sphere of influence. The discovery of oil in 1931 set Bahrain on a path of development that would see it become one of the world’s most prosperous countries (see Economy).

In 1971, in the wake of Britain’s ‘East of Suez’ strategic withdrawal, Bahrain’s protectorate status was relinquished and Bahrain became independent under the rule of Sheikh Isa al-Khalifa. Both British and US military forces have been allowed use of Bahraini ports and airfields, which were vital to the prosecution of the two Iraq wars and the 2002 Afghan war. Bahrain’s pro-Western stance was consolidated through membership of the Gulf Co-operation Council (GCC), a six-nation body designed to enhance economic and security co-operation between the Gulf States. The GCC has also dealt with territorial disputes between members, principally ownership of the tiny but potentially oil-rich Hawar Islands, which are claimed by both Bahrain and Qatar.

Bahrain’s economic development has not been matched by comparable progress in the political arena. The country is still an absolute monarchy in which dissent is barely tolerated; its relatively liberal reputation is based purely on the availability of alcohol and casinos (much enjoyed by rich Gulf potentates who cross the causeway to indulge). An elected forum, the majlis, provided an arena for the expression of popular opinion until its dissolution by the Sheikh in 1975. The opposition was mostly of a nationalist or socialist inclination until the turn of the 1970s. Then, following the 1979 revolution in Iran, a Shia Islamist movement emerged in Bahrain. (The bulk of the population is Shia, while the ruling al-Khalifa clan and their principal allies adhere to the Sunni faith, the other principal branch of Islam.) The government believes that much Shia agitation is fostered by Iran and has taken firm measures to suppress Shia movements on several occasions.

In March 1999, Sheikh Isa died. He was succeeded by his son, Sheikh Hamad bin Isa al-Khalifa. While the new Sheikh has retained ultimate control over the Bahraini political system, there undoubtedly have been significant moves to open up the political system. Among Sheikh Hamad’s first actions was to declare an amnesty for political opponents. Then, in February 2002, he declared Bahrain a constitutional monarchy with himself as Head of State and announced that majlis elections would be held. These took place in October 2002. Women were allowed to stand as candidates for the first time, provoking complaints from traditionalist Islamists, while Islamist candidates were themselves allowed to stand for the first time. A small majority was secured by a bloc of independent and secular candidates. The first woman to be appointed to head a government ministry was Nada Haffadh in 2004, who was made health minister: a symbolic turn of events that hinted at genuine progress in women's rights in Bahrain.

A prominent opposition figure, Majid al-Alawi, recently returned from exile, was appointed to a ministerial post in the new government. Early in 2003, there were further protests against the impending war against Iraq, and Bahrain’s role in hosting American and British forces. In May 2003, thousands of victims of alleged torture petitioned the King to cancel the law that prevents them from suing suspected torturers. These protests instigated a general concern for security in Bahrain, and in 2004, the protests against fighting in Iraqi cities once again materialised. However, the King sacked his Interior Minister after police tried to prevent the protests. These kind of moves seem to render the country more stable and Sheikh Hamad appears to have succeeded in quelling the Shia opposition – at least for the time being.

Bahrain was a traditional Arab monarchy, ruled since 1782 by an Emir selected from the al-Khalifa dynasty through an appointed cabinet led by a Prime Minister. Constitutional changes introduced by the current Emir, Sheikh Hamad bin Isa al-Khalifa, in February 2002, establish him as head of state of a constitutional monarchy. The Emir governs with the support of an appointed cabinet of Ministers. He is also advised by the Majlis as-Shura (People’s Council), which was elected for the first time in October 2002. Its 40 members serve in single-seat constituencies for a four-year term.