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attempts to find a political accommodation between Iran and the US that could potentially reopen many Western and other markets to the Islamic Republic. In its latest forecasting, the IMF also sees Iranian consumer price inflation this year moving up to 39% from last year’s 36.5% and a 2021 current account surplus equivalent to 1.2% of GDP. Iranian unemployment would likely stay at around 11% this year, the Fund added.
4.0 Real Economy 4.1 Industrial production
Iranian government pledges 40 trillion rial to drive indigenisation of foreign product parts
Iran has set aside Iranian rial (IRR) 40tn ($980mn at the official exchange rate, $172mn at the free market rate) for industrial indigenisation projects, Mehr News Agency has reported.
The country has a long history of taking foreign technology and making it its own. Examples of this in the auto industry include the localisation of the Peugeot 206 and 405 cars. The parts for these vehicles are now made by Iranian companies.
Mehdi Sadeghi Niaraki, Iran’s deputy industry, mining and trade minister for industrial affairs, reportedly said that the project was aimed at helping local businesses invest in new technology so that Iran can reverse engineer products and rely less on international supply chains, thus bringing the cost of production down markedly.
“In line with the ‘surge in production’ movement, the Ministry of Industry, Mining and Trade is trying to use all existing capacities in the country,” the official said while launching the new programme.
In July, Niaraki said €277mn was signed over to auto part companies and automakers to indigenise the production of parts seen in foreign brands. It is believed the parts he was referring to included Peugeot 301 components.
Iran’s industrial production increased by 10.9% y/y in the fourth quarter of 2020.
16 IRAN Country Report August 2021 www.intellinews.com