It also possesses important shrines of its own which cause many pilgrims to linger there, and wealthy Indians not infrequently choose Bagdad as a suitable spot in which to end their days in the odour of sanctity. There has also sprung up of late years considerable direct trade between the European and American markets and Bagdad, and several foreign houses, especially English, have established themselves there. Germany also has invaded this market.

The staple articles of export are hides, wool and dates. The export trade of Bagdad amounts to about £750,000 annually, and the import trade to about £2,000,000. The imports consist of oil, cheap cottons, shoes and other similar goods, which are taking the place of the picturesque native manufactures. Even the Bedouin Arabs wear headdresses of cheap European cotton stuff purchased in Bagdad or thereabouts, while the common water vessels throughout the country are five-gallon petroleum tins, which also furnish metal for the manufacture of various utensils in the native bazaars.

Bagdad is in communication with Europe by means of two lines of telegraph, one British and one Turkish, and two postal services. There is a British consul-general, who is also political agent to the Indian government. His state is second only to that of the British ambassador at Constantinople. Besides the gunboat in the river, he has a guard of sepoys, and there is an Indian post-office in the residency. Formerly the British government maintained a camel-post across the desert to Damascus. This was abandoned about 1880 when the Turks established a similar service. By means of the Turkish camel-post letters reached Damascus in nine days. There is also a Russian consul-general at Bagdad, and French, Austrian and American consuls.

The Euphrates Valley (or Bagdad) railway scheme, which had previously been discussed, was brought forward prominently in 1899, and Russian proposals to undertake it were rejected. British proposals followed, but were opposed by the Germans, who, as controlling the line to Konia in Asia Minor, claimed preference in the matter. A provisional convention was granted to a German company by the Porte, and an iradé was obtained in 1902. In 1903 there was considerable discussion as to the placing of the line under international control, and the question aroused special interest in England in view of the short route which the line would provide to India, in connexion with fast steamship services in the Mediterranean and the Persian Gulf. It was decided by the British government that the proposals made to this effect did not offer sufficient security. The financial arrangement as finally agreed upon was that German financiers should control 40% of the capital of the line; French (through the Imperial Ottoman Bank), 30%; Austrian, Swiss, Italian and Turkish, 20%; and the Anatolian Railway Company, 10%. In 1904 the line was completed from Konia through Eregli to Bulgurli. In 1908 an iradé sanctioned the extension across the Taurus to Adana, and so to Helif near Mardin (522 m.).

The population of Bagdad is estimated variously from 70,000 to 200,000; perhaps halfway between may represent approximately the reality. More than two-thirds of the population are Moslems, mostly Shi‛as, with the exception of the official classes. There are about 34,000 Jews occupying a quarter of their own in the north-western part of the city; while in a neighbouring quarter dwell upwards of 6000 Christians, chiefly so-called Chaldaeans or Nestorians. The Carmelites maintain a mission in Bagdad, as does also the (English) Church Missionary Society. The Jews are the only part of the population who are provided with schools. A school for boys was established by the Alliance Israélite in 1865, and one for girls in 1899. Besides these, there is also an apprentice school for industrial training.

The Jews constitute the wealthiest and most intelligent portion of the population. A large part of the foreign trade is in their hands, and at the season of the sheep-shearing their agents and representatives are found everywhere among the Bedouins and Madan Arabs of the interior, purchasing the wool and selling various commodities in return. They are the bankers of the country, and it is through their communications that the traveller is able to obtain credit. They are also the dealers in antiquities, both genuine and fraudulent. Next to them in enterprise and prosperity are the Persians. The porters of the town are all Kurds, the river-men Chaldaean Christians. Every nation retains its peculiar dress. The characteristic, but by no means attractive, street dress of the Moslem women of the better class comprises a black horse-hair visor completely covering the face and projecting like an enormous beak, the nether extremities being encased in yellow boots reaching to the knee and fully displayed by the method of draping the garments in front.

Bagdad is governed by a pasha, assisted by a council. The pasha and the higher officials in general come from Constantinople, but a very large portion of the other Turkish officials seem to come from the town of Kerkuk. They constitute a class quite distinct from the native Arab population, and they and the Turkish government in general are intensely unpopular among the Arabs, an unpopularity increased by their religious differences, the Arabs being as a rule Shi‛ites, the Turks Sunnites. Besides the court of superior officers, which assists the pasha in the general administration of the province, there is also a mejlis or mixed tribunal for the settlement of municipal and commercial affairs, to which both Christian and Jewish merchants are admitted. Besides these, there are the religious heads of the community, especially the nakib and Jewish high priest, who possess an undefined and extensive authority in their own communities. The Jewish chief priest may be said to be the successor of the exilarch or resh galutha of the earlier period.