Captain Francis Light is credited with establishing the British colony of Penang, a significant development in the history of British colonial expansion in Southeast Asia. In 1786, Light negotiated with the Sultan of Kedah for the right to settle on the island of Penang, which was largely uninhabited at the time. The island's geographical position made it highly attractive as it sat at the entrance to the Strait of Malacca, a crucial maritime route for trade between Europe and Asia. The British were eager to secure their interests in the spice trade, as well as to counteract the influence of the Dutch in the region.

After securing the rights to the island, Light arrived in Penang on August 11, where he began to establish a settlement. He named the island 'Prince of Wales Island' in honor of the British heir apparent. The establishment of the colony involved constructing a fort, building settlements, and promoting trade. Light's leadership and strategic vision led to a rapidly growing population, primarily made up of Chinese and Indian immigrants, who came to work in trade and agriculture. By the end of the 18th century, Penang had become a bustling port city, establishing a legacy that would contribute significantly to the economic and political landscape of the region.

Light's tenure laid the groundwork for subsequent British colonial policies in Malaya, leading to further expansions in the 19th century. The success of Penang as a trading port attracted other settlers and traders, transforming it into a melting pot of cultures, which continues to influence the region today.