Iran's Fiscal 2021-20 Import Bill: $38b

EghtesadOnline: Thirty commodities accounted for one-third of the value of Iran’s total imports in the last fiscal year that ended in March.

News ID: ۷۸۶۴۱۶

05 May 2021

The Persian-language daily Donya-e-Eqtesad, citing data from the Islamic Republic of Iran Customs Administration (IRICA), said imports included 4,959 goods weighing 33.7 million tons worth $38.89 billion.

Last year’s imports decreased six percent in volume and 12% in value compared to the year before.

Livestock feed, cell phones and rice topped the list: 9.86 million tons of livestock feed worth $2.5 billion, 5,000 tons of cell phones worth $2.43 billion and 1.03 million tons rice worth $925 million were imported.

Imports were divided into three groups of capital, intermediate and consumer goods. Consumer goods accounted for 16% of value and 5.6% of weight of the imports; intermediate goods accounted 70% of value and 93% in volume and capital goods 14% of the value and two percent of the overall import.

Of the 4,959 items, 3,517 were consumer goods, 865 capital goods and 577 were intermediate goods. Import of consumer goods stood at 1.89 million tons worth $6.41 billion, intermediate goods around 31.31 million tons worth $27.12 billion and capital goods 536,000 tons worth $5.35 billion.

Cell phones, livestock feed and synchronous digital hierarchy (SDH) devices were at the top of the list of consumer, intermediate, and capital goods.

Unlike intermediate and capital goods, import of consumer goods, particularly kitchen and home appliances and those with local counterparts, were on the decline both in volume and value.

Main consumer goods import included cell phones, rice, bananas, pharmaceutical, frozen meat, and tobacco accounting for 73% of the total value of consumer goods’ import.

Capital goods such as SDH devices, machinery and mechanical appliances, cold compressors, network switches, combined heat and power generators, compressors of automotive air conditioning system, data processing machines, and computer servers were the main imported capital goods constituting 22% of total value of capital goods import.

Field corn, oilcake, soybeans, wheat, sunflower oil, and carbon electrodes were the main imports of intermediate goods, accounting for more than 26% of total intermediate goods imports in value.

The first 10 items on the list of imports accounted for 59% in weight and 25% in value. Imports of items included in 25 groups of necessity goods accounted for 69% in weight and 31% in value of the total imports.

Import Origins and Essential Goods

According to the head of Customs Administration of the Islamic Republic of Iran, Mehdi Mirashrafi, imports from China totaled 3.54 million tons worth $9.7 billion during the year to March 20 to account for 10.6% of the total volume and 25.3% of the value.

Industrial machinery and raw materials, medical equipment, paper, wood, textile, auto parts and sports equipment were the  main imports from the South Asian power in fiscal 2020-21.

A total of 23.1 million tons of essential goods including corn, cell phones, rice, soybean meal, oilseeds, wheat and unprocessed oils worth $12 billion were imported, he said.

Iran imported essential goods worth $9.7 billion from China,  $9.6 billion from the UAE, $4.3 billion from Turkey, $2.1 billion from India, and $1.8 billion from Germany in the year to March 20.

Also known as necessity goods, essential goods are products consumers buy, regardless of changes in income levels. The government subsidizes the import of essential goods.

According to Mojgan Khanlou, an official with the Plan and Budget Organization, the government is allowed to gradually discontinue the allocation of subsidized forex for importing necessity goods in the first half of fiscal 2021-22.

Sanctions-Driven Restrictions

Due to the US economic blockade the government has either banned or restricted some imports. “A list of banned imports including 1,600 items was released by the government to save forex reserves in the wake of the sanctions. The banned items increased to 2,262 last year [ended March 20],” Mehrad Ebad, a member of the Iran Chamber of Commerce, Industries, Mines and Agriculture said in a write-up for the news portal of Tehran Chamber of Commerce, Industries, Mines and Agriculture.

The restrictions and ban on imports will continue even if the sanctions are lifted, the Minister of Industries, Mining and Trade Ali-Reza Razm-Hosseini has said.

“These measures are aimed at boosting domestic production,” he was quoted by IRNA as saying. Production of parts in many industries have been indigenized and domestic manufacturers account for 75% of home appliances and 80% of auto production, he said.