Bahrain takes Western values for a test drive

There are no hotel rooms to be had in Bahrain, or in most of the neighbouring Gulf states. Day trips have been organised from Riyadh, Beirut and Cairo. A clutch of Arab royals, the Sultan of Brunei and the King of Spain, are expected, and Prince Andrew arrived early, and is busy golfing away for Britain.

The attraction is the Bahrain Grand Prix, the first in the Arab world, and the biggest sporting spectacle ever staged in the Middle East. The cost of building the circuit and allied infrastructure is some $200m (£110m), and 100,000 visitors are due to arrive today in this tiny kingdom.

The event, of course, is about far more than mere sport. It is an attempt to bridge the gap with the outside world at a time when Islam is in the grip of an anti-Western tide. The race would not only bring in up to $500m worth of investment, but also show that the Arab world is not all about violence and turbulence.

Bahrain, the size of the Isle of Man and with a mixed Sunni and Shia population of 650,000, has become something of an experimental laboratory for the region, watched with nervous interest by its oil-rich and conservative neighbours, not least Saudi Arabia, to which it is linked by a 15-mile causeway.

The changes began when the then Crown Prince, Hamad bin Isa al-Khalifa, became king five years ago. Sacking his father's reactionary advisers, he held a referendum on a constitutional monarchy. Elections took place in 2002. After decades of suppression of dissent, political prisoners were freed and religious tolerance decreed.

Bahrain has pursued Westernisation with varying degrees of success. It has no significant oil or natural gas, and aims to become the financial centre of the Middle East - hence the $1.3bn Bahrain Financial Harbour under construction.

Not all attempts to open up have been successful. The much publicised filming ofBig Brother collapsed after protests over the sexes appearing together, even though sleeping areas were segregated. Police had to stop 1,000 protesters who attempted to storm the set.

Islamist MPs have demanded gender-segregated schools and workplaces, and a ban on alcohol and satellite television. Cars were set alight by religious protesters trying to stop Lebanese singer Nancy Ajram performing and a 100-strong knife-wielding mob burst into a restaurant serving alcohol in the capital.

The Islamist cause was dealt a severe blow last week after the revelation that one of its most vocal leaders, Abdullah Ahmed al Shaeab, had been arrested over alleged sexual offences involving a housemaid.

Dr Nada Haffadh, a member of the all-appointed upper house of parliament, feels the government must do more to reduce Islamist influence. She said: "We are making rapid commercial progress, but social progress is not taking place at the same rate."