Iranian parliament approves $296B budget bill

Business Materials 4 March 2015 15:43 (UTC +04:00)

Baku, Azerbaijan, Mar. 4

By Fatih Karimov - Trend: The Iranian parliament approved the $296 billion national budget bill for the next Iranian fiscal year, which starts on March 21.

The bill was approved on Tuesday by 144 MPs voted in favor, 33 against, and 6 abstained, Iran's IRNA news agency reported on March 4.

The US dollar is 28,500 rials in the budget bill, while it is sold at 35,000 rials in the free market.

The budget bill initially presented by President Hassan Rouhani to the parliament was $293 billion.

According to the bill, the administration will be obliged to cut cash subsidies to well-paid and rich families.

Although the generalities of the budget bill had been approved by MPs on Feb. 15, some critics were concerned by a significant deficit in the budget bill.

For example, the budget bill has been drafted based an oil price of $72 per barrel. This is while oil price is currently below the figure. The IEA has predicted that oil will drop to below $60 on average in 2015.

Mohammad Reza Pourebrahimi, vice chairman of the economic committee of the parliament, told Mehr news agency on Feb. 25 that the budget bill would face a $17 billion deficit.

The Guardian Council plans to ratify the budget bill on March 16 and pass instruction to the administration.

The volume of cash subsidies has decreased from $14.7 billion to $13.6 billion, which indicates that a portion of families will be cut from the list of cash subsidy receivers.

The administration has announced that it has prepared a special plan for running the country even if oil price drops to $40.

Last July, oil was traded at $108 per barrel but has since plunged to $57 per barrel.

Iran is a member of OPEC. The OPEC basket price had dropped to $42 in January.

Edited by CN