Iran’s point-to-point inflation for the previous Iranian calendar month – which ended November 21 – was about 50 percent with food inflation recorded at above 70 percent in 12 provinces.
According to a recent report by EcoIran website, as the government lifted import subsidies for essential goods earlier this year, food prices have jumped an average of 67.7 percent compared with the same period in the previous year. The news outlet said that at least 12 provinces are in a red state in terms of food inflation, referring to a very critical condition.
The inflation rate for food items was especially high in the province of Sistan-Baluchestan, reaching a whopping 84 percent, with Lorestan province hitting 78 percent to be tat second place. The two provinces are low-income regions where the quality of the items they consume are also lower than in other provinces.
The figures indicated a slower rise in prices as the inflation of food items even reached 100 percent in some provinces in previous months. According to the data published by the Statistical Center of Iran (SCI) in late July, the overall nationwide point-to-point annual food inflation rate in June 2022 compared with the same period in 2021 was 87 percent, but in four provinces the rate reached almost 100 percent.
Most price increases happened since early May when the government scrapped a food import subsidy to save around $15 billion annually. The move immediately triggered a massive rise in prices for basic food staples, such as bread, dairy products, cooking oil and meat. Although the government has repeatedly said its oil exports are steadily increasing despite sanctions by the United States, economic conditions keep deteriorating, with Iran's battered currency, the rial, hitting historic lows in the recent months with sporadic recuperations.
The rial has been in a freefall since the current wave of protests and strikes have rocked the country following the death in custody of Mahsa Amini, hitting a low of more than 360,000 rials against the US dollar in November. The US dollar rose from 295,000 rials to 365,000 in two months, but that is just an early signal of what is to come considering the ongoing protests.
Despite assurances by President Ebrahim Raisi’s government that it has stopped printing money, Mahmoud Jamsaz, an economist in Tehran, insisted that simply the format of government borrowing has changed, not the fact that it is adding to the money supply. This in turn fuels more inflation, impoverishing tens of millions of people who were modest wage earners or members of the middle class, able to live relatively comfortable lives before. It is not clear how much foreign currency the government has injected into the market since the first week of September when the rial began to fall. Often, the Central Bank of Iran (CBI) withholds such information.
There have been unconfirmed reports that people associated with the government have been sending their capital out of the country as protests show no signs of stopping. Unlike past nationwide unrest, this time it is clear that protesters want an end to the clerical regime of the Islamic Republic and will not be easily satisfied with minimal concessions, even if the hardliner core of the regime decides to offer an olive branch.
As antigovernment protests continue in Iran, the government will face a multitude of additional economic problems and energy crisis in the coming months.
The accelerating exodus is not limited to medical and engineering professionals anymore as many business owners have also started to transfer their businesses to nearby countries where trade transactions are easier, especially to the Persian Gulf littoral states.
According to a recent article in the Tehran newspaper Arman Melli, during the past year about 30,000 personnel of different medical professions, including doctors, nurses, and paramedical technicians, have applied for Certificates of Good Standing with intent to immigrate to Oman. The paper claimed that within the last four years, 16,000 general practitioners have left the country. The high number of emigrations has become so alarming that the officials of medical organizations have warned of serious shortages of doctors in the near future.
In April, Iran's Medical Council said about 4,000 doctors have applied for Certificates of Good Standing in the previous 12 months with the intent to leave the country. Council spokesman Reza Laripour said that the annual number of such applications was less than 600 between 2013 and 2015.
Head of the Medical Council of the Islamic Republic, Mohammad Raeeszadeh, said, "The medical community faces fundamental challenges in some specialties, so that we may not have graduates in some fields in the future.” He warned of the risk of regression to 40 years ago when it had to hire foreign doctors to meet domestic needs.
Lack of a promising future is the main reason why professionals decide to leave. Incomes have sharply declined in the past years as Iran’s currency has lost its value by more than tenfold, and the state seems to become more inept and arbitrary in governing the country.
On the backdrop of Iranian doctors emigrating in droves, the health ministry in September increased the exit permit bond for medical, dental and pharmacy students to $5,000 per year. Deputy minister for education at the health ministry, Abolfazl Bagherifard, said that students in graduate levels should provide 1.5 billion rials ($5,000) to leave the country for a year and undergraduate levels should provide bonds worth $2,000. Students must provide an official letter of commitment to return as well as another person's guarantee by depositing a real estate bond or a bank guarantee.
Experts and social scientists in Iran and abroad have told the media that the brain drain in the past few decades, beginning with the 1980-88 war with Iraq, has been accelerated by lack of social freedoms in the clerical-dominated system, political upheavals, deterioration of the economy, and government repression.
The government has stepped up pressures and restrictions on students and graduates. Late in November, the parliament presented a proposal to ban students who participate in protests from traveling abroad for ten years. Recently, the Ministry of Science Research and Technology has also approved regulations that would increase the costs of receiving university degrees six to 10 times.
All Iranians who study in government universities must work about twice the duration of their studies for a state institution before they can get their certificates. If they opt out of working for the government, they should pay the cost of their education to get their document. As per recent regulations, the fees to get their degrees have increased up to 10-fold.
However, even those measures are not enough to stop Iranians from leaving the country, with many families deciding to either send their children abroad before starting university or forgetting about getting a degree altogether. Ali Sharifi-Zarchi, a professor at Tehran’s Sharif University of Technology, believes that the new measures would even accelerate emigration, saying that the new fees mean that the government is urging students to forget about Iranian universities and study abroad where they can find a job and help pay for their expenses.
Almost half of Iranian youth want to leave the country amid pessimism about their future, a recent opinion survey conducted from abroad shows.
Mohammad Eslami, head of the Atomic Energy Agency of Iran (AEOI) and a vice-president, told journalists the project, known also as the ‘Kanun’ plant due to its proximity to the river, was “important and necessary” for the south west of Iran. He said work was beginning with preparing the site for construction of a 300-megawatt (MW) plant.
Plans for Darkhovin go back to days before the 1979 Revolution, when Shah Reza Pahlavi agreed with France the construction of two 910-MW reactors on the site. In 1992 then president Akbar Hashemi Rafsanjani on a visit to Beijing agreed a plan with China, against United States objections, to sell two 300-MW reactors for Darkhovin, but the Chinese subsequently withdrew, apparently due to continuing pressure from Washington.
Iran did sign up Zurich-based ABB as a consultant, but the Swiss-Swedish robotics and power multinational withdrew more than once before finally quitting in 2018 as the US introduced ‘maximum pressure’ sanctions threatening punitive action against any entity having banking dealings with Iran.
Eslami, making an oblique reference to the apparent failings of “foreigners,” said Saturday Iran would itself construct the $2-billion plant, using a pressurized water reactor (PWR), over eight years on 59 hectares, as part of a wider plan to build “local” plants to power Iran’s industries.
It is not clear if Iran has the technology to independently complete a nuclear reactor. It took Russia decades to finish the Bushehr reactor and Iran was completely dependent on Moscow.
The $2 billion price tag might also be too high and not make sense in comparison to building green renewable sources. For example, Saudi Arabia’s ambitious green energy projects are expected to cost a total of $10 billion with both solar and wind power by 2026 that can provide 50 percent of its electricity needs.
The 300 megawatt that the $2 billion project promises to provide is a tiny contribution to Iran’s ever-increasing consumption of nearly 70,000 megawatts.
The reactor itself has been billed as the country’s first one to be indigenously designed and built. In line with the stress on ‘self-reliance’ beloved of the Supreme Leader Ali Khamenei, the AEOI chief stressed the role of Iranian companies in manufacturing the plant’s equipment, including cooling pumps.
Russia has long been in talks with Tehran over new units for Iran’s sole nuclear power station at Bushehr, southern Iran, which began operating in 2011 but has had a checkered performance, producing only 1.25 percent of the country’s electricity in 2021-22. Iran’s stated aim is to produce 10,000 MW of electricity from atomic plants, which if attained would be around a third of the current output today from nuclear power in Japan and roughly equivalent to that of the United Kingdom.
While PWRs are the most common nuclear power plants across the world, any atomic work by Iran is deemed suspicious by the United States, which has twice this year sponsored resolutions critical of Iran at the governing board of the International Atomic Energy Agency (IAEA), the United Nations agency tasked with verifying the peaceful nature of nuclear programs.