A 420 trillion rial ($52.5 billion) budget will come up for debate before the Iranian majlis (parliament) next week, with the major highlights including spending increases in construction and plans to inject growth into textile and agricultural sectors, reported the Daily Iran.. The new budget will take effect at the start of the Iranian year, on March 21, 2001.
The new budget, which was formulated by the official Planning and Management Organization, allocated a record 37 trillion rial to construction projects, up 40 percent from the amount recorded in the previous budget. The cost of running the government—referred to as the state budget—will amount to about 155 trillion rial, representing an increase of more than 20 percent over the current budget.
One of the ambiguous areas of the new budget, especially in terms of expected revenues, is the price of crude oil. The current budget, for example, set the average cost of a barrel of Iranian crude at $15.80 per barrel, where as today a barrel is being sold at an average of $29 on world markets.
With the oil price mind, the new budget calls for the establishment of a board of trustees, to oversee the management of surplus oil revenues created by the gap between higher-than-forecast world prices and budgeted oil earnings.
But while the size of the surplus is not apparent, Iran’s economic architects know what they want to do with at least part of the money. According to Safdar Hosseini, the deputy head of the Planning and Management Organization, a portion of the excess oil revenues would be channeled toward the country’s depressed textile and agricultural sectors. — (Albawaba-MEBG)