A member of the Majlis Economy Commission has blamed excessive injection of money into the economy, psychological factors and increase in the public demand for the runaway inflation in the country.
Gholamreza Mesbahi Moqaddam told reporters Sunday that the rise in the costs of economic activities due to the rise in wages and prices of raw materials as well as mounting costs of imported machineries and spare parts have contributed to inflation which reached over 19 percent in the month to November 22.
“Certain people have taken advantage of the situation to divert high liquidity towards middlemen and real estate purchase,“ the parliamentarian was quoted by IRNA as saying.
The priority given by the incumbent administration to development projects have prepared the ground for some to spend the financial resources on irrelevant services rather than construction, he stated.
“It cannot be denied that some are involved in creating crisis but it is unclear whether the government is unable to confront them,“ Mesbahi Moqaddam observed.
In a related development, a member of the Majlis minority faction has urged the government of President Mahmoud Ahmadinejad to take measures to curb the recent rise in prices of commodities which put pressure on the low- and middle-income strata.
“The people are frustrated with the recent rise in consumer prices--an issue which the Majlis has repeatedly warned against and denied for long by the incumbent government,“ Qodratollah Alikhani said.
Urging Ahmadinejad to fulfill its election slogans, the deputy, who represents Avaj and Boin Zahra, Qazvin province, stated that Iranians are still waiting for oil revenues, which flushed the government coffers, to make a change in their lives.
“In the past two and half a years, your administration earned close to $150 billion in oil earnings. This is equal to oil revenues the Rafsanjani government got in its two tenures and Khatami in eight years,“ he said, Fars news agency reported.
The people are entitled to see petrodollars improve their lives and giant projects such as those constructed during the former governments are being built, Alikhani added. “But there is now no sign of major projects nor is there an improvement in living conditions; . . . . and some people wish to eat eggs.“
There is no justification for the worsening of national economic situation as global crude prices have reached record high, he concluded.

Government endeavors to increase the number of filling stations offering CNG.

Majlis Research Center reported Sunday that about $1.1 billion should be allocated to the government for gasoline imports.
The research arm of the Iranian parliament stated that the $22.2 billion earlier allotted to the government for importing gasoline which is heavily subsidized in this country would not meet domestic fuel demand.
The 46-day delay in starting the gasoline rationing plan, global gasoline price hikes, shortage of filling stations offering compressed natural gas (CNG) are responsible for inadequate budget for gasoline imports, IRNA quoted the report as saying.
Details of changes made in the gasoline rationing plan were announced Sunday by the National Iranian Oil Production and Distribution Company (NIOPDC).
The NIOPDS Public Relations reported that quota for private car will increase to 120 liters per month from the earlier 100 liters from December 22 and 480 liters will be added to their smart cards for a four-month period.
Motorists are entitled to use the gasoline remaining from the first phase (late June to December 21) during the second stage.
Quota for motorcyclists will increase by six liters to 36 liters per month, PIN reported.
Quota for pickups (group II) will be cut by 50 liters to 400 liters per month, taxis will get 700 liters per month--100 liters less than the amount allocated in the first phase.
Taxis with bifuel engines will be given 400 liters per month as efforts will be made to increase the number of filling stations offering CNG.
Average consumption of gasoline has been 59 million liters per day since gasoline rationing came into force in late June. The figure shows a 22-percent, or 5.75 million liters, decline compared to the amount for the same period last year.

A proposal to manufacture a joint Islamic car was first brought up at a gathering of the Organization of the Islamic Conference (OIC) in Turkey. Unfortunately, some domestic circles think the idea is just about equipping cars with systems to show the Qibla and other welfare facilities for Muslim drivers. However the initiative, if implemented, is an economic plan requiring heavy investment and lengthy planning.
Production and marketing of a car is not a simple task even if the countries involved are, like Iran, pioneers in the region’s automobile sector.
Managing director of Iran Khodro, Iran’s giant car manufacturer, Manouchehr Manteqi announced recently that the decision on producing the car will be taken in the upcoming OIC meeting in Tehran in January. Once the plan is approved, countries such as Iran, Syria, Azerbaijan Republic, Senegal and Egypt will begin planning for joint production. If the programs proceed according to schedule, a minimum of two years will be needed for production to begin.
There are stiff competitions in the world auto market and major automakers are grappling with numerous problems to market their products. If Islamic countries are to achieve their target of producing a joint car, they would have to make comprehensive evaluation and planning.
All OIC member states should pool resources on the production of the car by imposing preferential tariffs on it. The project can be implemented by capitalizing on technical and trade advantages of the 56 OIC states and other countries.
In June 2006, the grouping of Islamic countries has called on members to take steps to produce small and medium aircraft, telecommunications satellite and use nanotechnology for producing vaccine. In additions, the organization has envisaged Iran Khodro Company, Middle East’s largest carmaker, to spearhead moves by Islamic car manufacturing countries to producing the Islamic car. The plan will be finalized in the upcoming OIC gathering in Tehran.
Thanks to its decades of experience in car production, Iran can effectively head the project.
The project is undoubtedly a practical but daunting task and can materialize with the joint cooperation of Islamic countries.
It is obvious the plan can open a new chapter in expansion of cooperation as well as economic development of the Islamic countries.

A consortium of domestic and foreign investors will implement the project.

Construction of the largest steel mill with annual output of 10 million tons will soon start in Kerman.
Announcing this, deputy head of Social Security Investments Company (SHASTA) for planning and development affairs said that a number of domestic and foreign investors have expressed their readiness to undertake the project, Fars news agency reported.
Mohammadreza Pour-Ebrahimi pointed out that following preliminary agreements between Kerman Governor General Office and Ministry of Industries and Mines, SHASTA formed a special consortium to implement the project with the assistance of local and foreign investors.
He said that SHASTA, UAE’s ETA, UK’s Mittal, Retirement Fund of National Iranian Copper Company and Kerman Development Company have been mentioned as possible participants in the project.
The official elaborated that the project, which is located in the Golgohar region of Sirjan, Kerman province, will cost of four billion euros and take five years.
Pour-Ebrahimi put the iron ore deposits in Golgohar Region at 1.2 billion tons and regretted that its potentials have been untapped and not been used for national economic development.
The official cited the sale of 73 million tons of concentrated iron ore as the only major activity in the area during 1991-2006.
He elaborated that major operations such as launching steel units and downstream industries have not yet materialized.
This means that investment, production and employment opportunities in the province and country have been missed in the past 17 years, he complained.
He pointed out that simultaneous investment in mining, production of ingot and establishment of downstream industries have been proposed by the consortium.
He hoped that with the final approval of the ministry, the project would be implemented. Thus, he added, over 10 million tons will be added to the national steel output making Kerman province the country’s steel hub.

Future Bank, a joint Iranian-Bahraini initiative, has been authorized to operate in Kish Island, Hormuzgan province, announced secretary of the High Council of Iran’s Free Trade Zones.
Mahmoud Salahi underlined that the inauguration of a branch of the bank will depend on the decision of its officials, Fars news agency reported.
He said that the Iranian party does not have any problem in launching the bank.
Underlining that there is no restriction on investing in the country’s free zones, he said that incentives would be provided for those interested in banking investment there.
Salahi pointed out that in the near future, investments in free zones would be profitable.
He continued that about 620,000 tourist have visited Kish Free Trade Zone since last March, indicating a rise of six percent compared to the figure for the same period last year. This proves the development of free zones and attention of investors to them, he concluded.
Future Bank is the third foreign bank which is to open a branch in Kish, Kish Trade Promotion Center wrote in its website www.kishtpc.com.
It was formed by two Iranian banks Melli and Saderat and the Bahrain-based Ahli United Bank.
The new bank has been registered in Kish Island with the initial capital of 20 billion rials.
About 50 percent of Future Bank’s capital have been made available by the Central Bank of Iran and the rest would be added soon.
The permission to launch the bank was issued in the year to March 2007. Former managing director of Bank Melli Iran, Valiollah Seif, is to head Future Bank.
Standard Charter Bank of Britain began operating in Kish Island in 2005. The Deputy Head of KFTZO for economic affairs Mohammad Ali Najafi said the entity is the second foreign-based bank after Iran-Europe Commercial Bank to operate in Kish.
Iran-Europe Bank is jointly owned by Iranian investors and German banks. Kish Island is the sole location in the country in which foreign banks have opened branches. They render all banking and monetary services to domestic and foreign clients in both rials and foreign currencies.
The bank is to launch in Kish as some European banks cut links with Iran under US pressure.
It is while former deputy Central Bank of Iran governor, Mohammad Jafar Mojarrad earlier warned pulling out of the banks would not solely affect Iran economy but would also harm industry and businesses of the European country as well.
Mojarrad, a former adviser to the IMF executive director, also earlier told Financial Times that Iran had weathered the impact of Washington persuading leading European banks to stop dollar transactions.

More solar/thermal electric power plants can be built in the near future.

Project to build Yazd Solar Thermal Power Plant has had a physical progress of 20 percent, head of Iran’s Electricity Development Organization said on Sunday.
According to IRIB, Mohammad Behzad announced that the project is completely different from the other power plant schemes.
Referring to the construction of this project, which is a combination of solar and thermal power plants, Behzad noted that Iran is among the first countries to produce electivity using this process.
He noted that the power plant will launched its gas and steam sections simultaneously.
Referring to the high potential of solar energy in Iran, he hoped that more solar/thermal electric power plants can be built in the near future.
The head of the project further noted that the project will incorporate natural gas, steam, and solar energies.
Mohammadreza Modarressi commented that investment in power stations employing integrated systems is more economical than the regular power plants.
“Importing modern technologies to build solar thermal electric power plants, developing and using clean energies, boosting the power plants’ output, reducing environmental pollution, meeting the ever-increasing demands for electricity in the area, and upgrading the electricity production capacity are among the main objectives of this project,“ Modarressi added.
Yazd Province, given its good solar resources, has been selected for this project.
The solar field is comprised of parabolic trough mirrors and is connected to a natural gas combined cycle power plant.
Solar thermal energy is a technology for harnessing solar power for practical applications from solar heating to electrical power generation.
Solar thermal collectors, such as solar hot water panels, are commonly used to generate solar hot water for domestic and light industrial applications.
Solar Electric Generating System (SEGS) projects are a series of utility-scale solar thermal electric power plants, which were designed and developed in the mid-1980s.