Tehran, Iran, Dec. 21
By Mehdi Sepahvand – Trend:
Iran’s National Development Fund seems to be growing into a useful tool to secure the country against rampant terrorism that is knocking at its doors.
Iranian officials have realized that economic underdevelopment has provided justification for the youth in neighboring countries to join terrorist groups.
“A low level of development, low income, and lack of economic opportunities create enough ground for terrorist groups and drug smuggling networks,” Foreign Minister Mohammad Javad Zarif recently told a conference.
In a recent bid that can plausibly be linked to the government’s concern for economic development as a tool against terrorism, Supreme Leader Ayatollah Ali Khamenei ordered the allocation of $500 million from the National Development Fund to developmental projects in the underdeveloped border province of Sistan-Baluchestan, over whose borders terrorist groups and drug gangs regularly venture in. Iran’s fight against these groups costs it a great deal, materially and spiritually.
According to the parliamentary decision, crude oil, gas condensate and net gas export revenues will make 30 percent of the fund during the first year of the 6th Development Plan, which will start March 2017.
For years 2 to 5 of the five-year plan, the petrodollar share will rise by a minimum of 2 percent each year.
In the past three years, the government had allocated 20 percent of its oil revenues to the fund. The new parliamentary decision, if implemented, will nearly double the amount by the end of the five-year plan.
Deputy Oil Minister Ali Kardor has recently said that by March 2017, Iran will be exporting 3 million barrels per day (mbpd) of crude oil and gas condensates. The country’s gas output, however, is almost entirely consumed domestically.
Each barrel of Iran’s Light oil was sold at $50.82 during the week to Dec. 9, $4.22 more compared to the previous week.
The average price of Iran’s Light oil this year was $40.35, while the average price of Heavy oil was $38.4.
The National Development Fund’s reserves stood at $24.4 billion in 2011 and $35 billion in 2012.
Besides Sistan-Baluchestan, Iran is seeing occasional clashes with terrorists on its western borders where Ilam, Kurdistan and Kermanshah provinces are situated.
By using the Development Fund, the Iranian government will be able to create political security in the country. However, the benefits will go beyond politics to cover areas of economy, society, culture and even environment.
Follow the author on Twitter: @mehdisepahvand