Loans for Startups, Tech Firms

EghtesadOnline: State-backed Iran National Innovation Fund is planning to loan 45 trillion rials ($277.7 million) to knowledge-based companies and tech firms in the current fiscal year (ending March 2021).

News ID: ۷۴۹۸۵۲

13 April 2020

The loans are expected to boost the production of technological items and help the domestic economy grow, Financial Tribune reported.

Rouhollah Zolfaqari, INIF’s deputy for planning, said loans directly affect the quality and volume of tech-based products, Mehr News Agency reported.

“It will support knowledge-based firms at all stages: from the first stage of developing ideas to making a prototype, launching a production line, entering the market and even supporting their customers for purchase,” he said.

Zolfaqari added that the loans will come with other aid packages, including investments and research and development support.

“INIF aims to encourage private companies to invest 3 trillion rials [$18.5 million] in local tech units and knowledge-based companies,” he said.

He noted that INIF has prepared numerous schemes to attract investors and help reduce the investment risk, adding that the fund is to compensate probable losses, while a share of the resulting profits will be transferred to the investors.

The fund is also planning to fund academic researches as a fundamental basis for promoting technology.

Zolfaqari noted that the financial aid package will be in the form of grants aimed at connecting the scientific group to industrial units. Studies on the internet of things, artificial intelligence, technological convergence, big data, blockchain, electric transportation, biology, extended reality and tissue culture will be supported by the fund, he added.

The official noted that the plan is expected to oil the wheels of domestic production.

More Efforts

Last week, INIF announced that it has recently invested 140 billion rials ($864,000) in nanotechnology firms to boost the domestic production of health-protective items used for shielding against the novel coronavirus.

According to the fund’s website Inif.ir, Iran Nanotechnology Innovation Council has helped INIF forge contracts with eligible knowledge-based companies.

Mohammad Ali Bahreini, the head of Nano-Fund Department at the council, told the media that these contracts are for the production of N95 and N99 facemasks for the medical staff.

“The money is also to be spent on enhancing machinery, especially the electrospinning machines, used in the production of masks,” he added.

With the COVID-19 outbreak distorting the Iranian startup ecosystem’s prospects, the state fund is extending an aid package to the sector.

According to INIF chief, Ali Vahdat, “The move is aimed at increasing the production of health-protective items needed during the pandemic, including N95 respirator and surgical masks, hand sanitizers, alcohol-based disinfectants, medical air disinfectant machines, antibacterial fabrics and coveralls for hospital use, as well as test kits and simulators.”

To receive the loan and start production, the applicant knowledge-based company should be certified by all the institutions involved, including Iran’s Food and Drug Administration and Health Ministry.

First reported in China’s Wuhan Province in December 2019, the coronavirus has so far infected 1,780,775 people around the world, claiming the lives of 108,838. The number of recovered cases has reached 404,494, Reuters reported on Friday.

Iran reported the virus outbreak in mid-February, which has so far taken the lives of 4,357 people out of a total of 70,029 infected people.

According to Iran’s Health Ministry, 41,947 patients have so far recovered from the disease.

Production Is the Solution

INIF’s announcement of plans is in line with the motto of the Iranian New Year.

Leader of Islamic Revolution Ayatollah Seyyed Ali Khamenei has named the new Iranian year, which began on March 20, the year of "Boosting Production" to help shore up Iran's sanctions-hit economy without relying on other countries.

"This year, production is the main and pivotal issue because an increase in production will help solve livelihood problems and unemployment, and make the country independent of foreigners and enemies. It can also help resolve the problem of the national currency’s devaluation to a great extent," the Leader was quoted as saying by his website.

US President Donald Trump's pullout from the 2015 international nuclear deal with Tehran last year and subsequent reimposition of financial, industrial and energy sanctions have sent the rial into a tailspin. The weak currency, galloping inflation and diminishing purchasing power have been vexing Iranians in recent months.

“Economic challenges such as the decline in production and the currency’s value can be partly attributed to economic mismanagement, which should be fixed," he said, reiterating that "boosting production" is key to solving problems besetting the country.

Ayatollah Khamenei also called on state officials and the public to develop relief plans to help alleviate the plight of those who have been financially hit as a consequence of the new coronavirus pandemic.

The global spread of the new coronavirus disease, called COVID-19, has forced affected countries, including Iran, to enforce quarantine regulations and a total or partial shutdown, as a result of which many have lost their jobs and sources of income.

The Leader commended the efforts of those who voluntarily joined the campaign against the disease as well as the armed forces that spared no effort for providing assistance in the fields of science, construction and production of health protective products.

Ayatollah Khamenei also hailed the Iranian people for firmly adhering to the guidelines issued by the country's health authorities to stop the viral spread.