"DUBAI (Dobayy), second largest of the seven emirates constituting the United Arab Emirates (U.A.E.) on the southern shores of the Persian Gulf. [...] Almost half the inhabitants of Dubai are from the Indian subcontinent; 100,000-150,000 are of Persian origin. This Persian community, the largest in the U.A.E., has been instrumental in promoting ties between Persia and Dubai.
Relations with Persia before 1357/1979. Toward the end of the 19th century the Persian port of Lenga lost its free-trade status, and nearby Dubai became the leading entrepĂ´t in the area. The liberal policies of the emir of Dubai persuaded many Persian merchants to move there from Lenga. Dubai thus became the major port for trade with Persia. In addition, the growing Persian community provided opportunities for special cultural ties between the two countries. Nevertheless, Dubai, as a member of the Trucial States, was still under British control, and its relations with Persia were governed by the overall relations between Great Britain and Persia.Persia was able to exploit the rivalry between Dubai and Abu Dhabi by developing close ties with the emir of Dubai. A consulate was opened in Dubai in July 1952; it was elevated to consulate general in 1954. On the other hand, the trade-oriented economy of Dubai ensured the emir's greater interest in Persia than in his immediate neighbors. In the early 1970s more than half of about 50,000 trading dhows in Dubai were engaged primarily in re-export trade with Persia. Cultural relations flourished as well, as Persia sponsored educational, health, and other institutions in Dubai. Students from Dubai attended Persian universities, particularly in Shiraz.
[...] The end of the war and subsequent developments in the Persian Gulf area, including the Iraqi invasion of Kuwait, only strengthened ties between Persia and Dubai. Many hospitals, schools, banks, recreation clubs, workers' cooperatives, and other institutions in Dubai are run directly by the Persian government or semigovernmental organizations. If no new major crises occur capitalist initiatives adopted recently by the Persian government should strengthen relations with Dubai in the near future". Source: www.iranica.com
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