The modern Iranian city of Bam surrounds the Bam citadel. Before the 2003 earthquake the official population count of the city was roughly 43,000. There are various opinions about the date and reasons for the foundation of the citadel. Some people believe[who?] that Bam city was founded during the Parthian Empire. Economically and commercially, Bam occupied a very important place in the region and was famed for its textiles and clothes. Ibn Hawqal (943–977), the Arab traveller and geographer, wrote of Bam in his book Surat-ul-`ard (The Earth-figure):
Over there they weave excellent, beautiful and long-lasting cotton cloths which are sent to places all over the world There they also make excellent clothes, each of which costs around 30 dinars; these are sold in Khorasan, Iraq and Egypt.
The ancient citadel of Arg-é Bam has a history dating back around 2,000 years ago, to the Parthian Empire (248 BC–224 AD), but most buildings were built during the Safavid dynasty. The city was largely abandoned due to an Afghan invasion in 1722. Subsequently, after the city had gradually been re-settled, it was abandoned a second time due to an attack by invaders from Shiraz. It was also used for a time as an army barracks.
The modern city of Bam was established later than the old citadel. It has gradually developed as an agricultural and industrial centre, and until the 2003 earthquake was experiencing rapid growth. In particular, the city is known for its dates and citrusfruit, irrigated by a substantial network of qanats. The city also benefited from tourism, with an increasing number of people visiting the ancient citadel in recent years.
The 2003 Bam earthquake was a major earthquake that struck Bam and the surrounding Kerman province of southeastern Iran at 01:56 UTC (5:26 AM Iran Standard Time) on 26 December 2003. The most widely accepted estimate for the magnitude of the earthquake is a moment magnitude (Mw) of 6.6 on the Richter scale; estimated by the United States Geological Survey. The earthquake was particularly destructive, with the death toll amounting to 26,271 people and injuring an additional 30,000. The effects of the earthquake and damage was exacerbated by the fact that the city chiefly consisted of mud brick buildings, many of which did not comply with earthquake regulations set in Iran in 1989, and that most of the city's people were indoors and asleep.
Due to the earthquake, relations between the United States and Iran thawed. Following the earthquake the U.S. offered direct humanitarian assistance to Iran and in return the state promised to comply with an agreement with the International Atomic Energy Agency which supports greater monitoring of its nuclear interests. In total a reported 44 countries sent in personnel to assist in relief operations and 60 countries offered assistance and support.
Immediately following the 2003 earthquake, the Iranian government began to plan a new city based on population control theories in order to eliminate problems that existed with the old city. The development of the plan took at least six months and resulted in significant complaints against the central government and local government by the Bam earthquake survivors. Nevertheless, government in Tehran continued its plans and currently the city is being rebuilt. The citadel is also being rebuilt with specialist care from the Ministry of Culture and from Japanese universities. The earthquake was an extreme tragedy and stunted the growth of Bam as a city, especially as about half of the city's residents were killed and most of the remainder hurt. Costs of the earthquake mounted to between $700 million and $1 billion U.S. dollars.
On 16 March 2007 a 130 km/h sandstorm hit the city of Bam without warning, suffocating 3 children, killing 2 in car accidents, and wounding 14 others.