Iran Industrial Investment’s Growth Prospects Bright

EghtesadOnline: Investments worth 2.87 quadrillion rials ($21.83 billion) are expected to be made in industrial units for which establishment permits were issued and 592.35 trillion rials (over $4.5 billion) are estimated to be invested in projects with operating licenses in the last Iranian year (March 2018-19).

News ID: ۷۴۷۵۳۰

11 June 2019

These investments indicate respective growth rates of 50.6% and 99.7% compared with the previous year, the latest report released by the Ministry of Industries, Mining and Trade shows.

Establishment Permits

A total of 24,414 establishment permits were issued over the one year, registering a 16.8% growth year-on-year. These projects are expected to create a total of 553,445 jobs, which is 15.5% more compared with last year's corresponding period.

Semnan Province with 2,145, Qom Province with 1,800 and Yazd Province with 1,712 had the largest share of establishment permits issued during the period, according to Financial Tribune.

Hormozgan Province, with more than 480.52 trillion rials ($3.65 billion) worth of estimated investment for 513 establishment permits, attracted the highest amount of investments.

The number of establishment permits issued for industrial units located in free trade and special economic zones grew by 48.1% to 385. Investments worth 403.48 trillion rials ($3.07 billion) are estimated to be made in these projects to generate 17.323 jobs, which registered a 6% and 30.9% growth YOY respectively.

The field of foodstuff and beverages saw the highest number of establishment permits (3,386) to create the highest number of jobs among other fields (78,840).

The highest amount of investment in these units is expected to be made in projects related to the production of coke- and oil-derived products (909.2 trillion rials or $6.91 billion). The volume accounts for 31.7% of total investments to be made in projects, for which establishment permits were issued over the period.

Operating Licenses

A total of 6.178 operating licenses were issued during the same period, which shows a 6.2% growth YOY. These projects are expected to create 106,203 jobs, 1.7% more compared with last year.

Isfahan Province with 642, East Azarbaijan Province with 469 and Tehran Province with 403 had the biggest share of all operating licenses issued during the year.

Hormozgan Province, with more than 193.8 trillion rials ($1.47 billion) for operating 92 industrial projects, attracted the highest volume of investments. This accounted for 32.7% of all the investments made in the projects for which operating licenses were issued.

The number of operating licenses issued for industrial projects located in free trade and special economic zones stood at 330, indicating a 10.7% growth YOY. More than 64.04 trillion rials ($487.04 million) worth of investments were made in these projects to create 8,100 jobs, registering a 607.5% and 58.2% growth respectively YOY.

The field of rubber and plastic production saw the highest number of operating licenses, namely 905, showing a 19.9% growth.

Projects in the field of food and beverages, for which operating licenses were issued and created the highest number of jobs (15,550), indicate an 18% decline.

The highest volume of investments in this regard were made in projects related to coke and oil derivatives production (208.81 trillion rials or $1.58 billion), accounting for 35.3% of all the investments made in industrial units for which operating licenses were issued.

The number of greenfield projects with operating licenses stood at 3,297, some 241 of which were for those located in free trade and special economic zones. The remaining 2,881 permits were issued for implementing brownfield projects, 89 of which were located in FTZs and special economic zones.

Mineral Production Permits

A total of 634 mineral production permits were issued during the 12 months under review, registering a 16% fall compared with the year before, the report showed.

These permits are expected to create 4,898 jobs, which indicate a 17.2% decline year-on-year.

The nominal mineral extraction capacity of these projects stands at 24.75 million tons, which shows a 40.4% decrease compared with the corresponding period of last year.

Khorasan Razavi Province with 58, Yazd with 49 and South Khorasan with 45 had the largest share of mineral production permits issued during the period.

Such permits issued over the 12-month period are expected to create the highest number of jobs in South Khorasan Province (508), Kerman Province (507) and Fars Province (364).

The provinces of Khuzestan, Kerman and East Azarbaijan with close to 4.4 million tons, 1.46 million tons and 1.42 million tons had the highest volume of nominal extraction capacities respectively.

According to the report, 1,033 exploration permits were issued over the 12-month period to register a 3.5% increase YOY.

Exploration costs stood at more than 907.6 billion rials ($6.9 million), registering a 33% increase YOY.