Gov’t Can Borrow €3.4b From NDFI

EghtesadOnline: The government can withdraw €3.4 billion from the National Development Fund of Iran in the next fiscal year (starts March 2020), to finance development projects.

News ID: ۷۴۹۲۷۴

24 December 2019

As proposed in next year's budget bill (202-21), NDFI, the  sovereign wealth fund, resources would be used in  financing 15 categories of projects, namely innovative industries, water supply, defense, transport and higher education.

Earlier this month, President Hassan Rouhani submitted the budget bill to the parliament.

The government is allowed to use up €2 billion for defense spending in line with priorities enshrined in the Sixth Five-Year Economic Development Plan, according to Financial Tribune.

Innovative projects will receive up to €235 million, as mentioned in the proposed budget. Knowledge-based companies will get up to €100 million. Up to €50 will be lent to set up innovation factories.

Innovative proposals by the Vice-Presidential Office for Innovation and Technology and the Academic Center for Education, Culture and Research will respectively receive  €70 million and €15 million.

To help promote innovative farming, the government is allowed to borrow up to €150 million from the NDFI.

Up to €150 million will be allocated for the development of rural water networks and supplying water to nomads. Up to €50 million is also planned to be used for maintenance and upgrading water infrastructure in specific urban areas.

The budget bill also considers using up to €150 million of NDFI resources for tackling problems caused by waste materials. The same amount is set to be used for financing watershed projects.

Transport expansion projects will be financed with up to €140 million in NDFI resources.

The Islamic Republic of Iran Broadcasting is also set to receive up to €150 million to enhance quality and quantity of its programs, TV series, animation and documentaries.

Ministry of Science, Research and Technology, and Ministry of Health, as two bodies in charge of higher education, will be allocated €50 million to purchase educational tools. The equipment can be imported if not produced by domestic companies.

Up to €100 million is also to be sourced for increasing the capital of the Export Guarantee Fund of Iran.

As proposed in the budget bill, share of the National Development Fund of Iran from oil resources (crude oil, gas condensates and natural gas exports) has been set at 20%.