Islamic Republic of Iran with an area of 1،648،196 sq.km and nearly 76.03 million populations has been located in South- West Asia. The country neighbors with Turkey and Iraq in west, Afghanistan and Pakistan in East, Armenia, Azerbaijan, Russia, Kazakhstan and Turkmenistan in North and Kuwait, Saudi Arabia, Qatar, Bahrain, United Arab Emirates and Oman in South through Persian Gulf and Oman Sea. Therefore, Islamic Republic of Iran, as a strategic country, has got common borders with states of ESCWA in South and West, SAARC in East and CIS and Caucasus as well as UNECE in North. The country is regarded as one of the richest countries in hydrocarbure reserves, so that it ranks the second for gas reserve and its export as well as the second for exporting crude oil in the world. According to the reports of the international institutions like the World Bank, Islamic Republic of Iran, with having more than 700 billion dollars GDP, scores the eighteenth out of twentieth outstanding economies, eighteenth and sixteenth for population and area respectively.
Trade-Industrial Free Zones
Incentives and advantages for investment in Trade-Industrial Free Zones
1-Tax exemption for 20 years from the date of operation for all economic activities
2-Foreign investment and nearly a hundred percent of the amount invested.
3- Freedom of entry and exit of capital and profits
4- Protection and guarantees for foreign investments.
5- Abolition of entry visas and easily issue of residence permits for foreigners.
6-Facilitated regulation on labor relations, employment and social security.
7- Transfer of part manufactured goods to the mainland without paying customs duties.
8- Elimination of pay customs duties on imports from outside to the region and vice versa.
9- Employing trained and skilled manpower in all different skill levels and professions.
10- Utilization of raw materials, oil and gas as feedstock and fuel for all industrial activities.
The list of the Trade-Industrial Free Zones of the Islamic Republic of Iran are as follows:
1-Qeshm Trade-Industrial Free Zone
2-Chabahar Trade-Industrial Free Zone
3-Aras Trade-Industrial Free Zone
4-Anzali Trade-Industrial Free Zone
5-Arvand Trade-Industrial Free Zone
6-Kish Trade-Industrial Free Zone
7-Maku Trade-Industrial Free Zone
Special Economic Zones
Incentives for investment in Special Economic Zones
i) Foreign Private Investment (Promotion and Protection) Act, 1980 ensures legal protection to foreign investment.
ii) Bangladesh is a member of Multi-Lateral Investment Guarantee Agency (MIGA), Overseas Private Investment Corporation (OPIC) of USA and International Centre for Settlement of Industrial Disputes (ICSID)
iii) Member of World Intellectual Property Organization (WIPO) and World Association of Investment Promotion Agencies (WAIPA).
In order to entice investors, the government has put in place an extensive programe of incentives, which include:
- Import of goods from the above mentioned zones for domestic consumption would be subordinate to export and import regulations, and export of goods from these areas will be carried out without any formalities.
- Import of goods from abroad or free trade zones or industrial area-would be carried out with minimal customs formalities and good internal transit cases would be performed in accordance with the relevant regulations.
- Log entry of merchandise subject to this article will be done without any customs formalities.
- Goods imported from outside or industrial areas or other commercial zones can be exported without any formalities of the country.
- Management of the region is allowed to assign the region to qualified natural or legal persons after classification and valuation.
- Owners of goods imported to the region can send all or part of their goods for temporary entry in to the country after doing customs clearance regulations.
- If the processing of imported goods is to some extent that changes the tariff of goods, the rate commercial benefit of the goods would be calculated equal the commercial benefit of raw materials and spare parts of the country.
- Importers of goods are allowed to hand over to others part or all of their products against warehouse receipt to be issued by the district administration, in this case the breakdown warehouse receipt holder would be the owner of the goods.
- The management of each district is authorized to issue certificated of origin for goods per applicant out of the area with the approval of the customs.
- All the goods imported to the region for the required production or services are exempted from the general import-export laws. Imports of goods to other parts of the country will be subordinated to export and import regulations.
- Percentage of goods produced in the zone, based on paragraph (d) of clause (25) of the law of the second economic, social and cultural development plan of the Islamic republic of Iran imported to the country, the proportion of total value added and domestic parts and materials used in the total price of the commodity production is allowed without any limitation and in addition to not having to order and open letter of credit.
- Goods manufactured in special economic zones, as well as raw materials and imported CKD parts into the country is not subject to price regulation due to unutilized resources and allocated currency.
The list of the special economic zones of the Islamic Republic of Iran are as follows:
1-Salafchegan special economic zone
2-Shiraz special economic zone
3-Assaluye special economic zone
4-Arge Jadid special economic zone
5-Payam Airport special economic zone
6-Persian Gulf special economic zone
7-Lorestan special economic zone
8-Amirabad port special economic zone
9-Bushehr Port special economic zone
10-Shahid Rajaee Port special economic zone
11-Sarakhs special economic zone
12-Sirjan special economic zone
13-Yazd special economic zone
14-Bushehr special economic zone
Supportive Goverment Policies
The Law on foreign investment in Iran under the name of “Foreign Investment Promotion and Protection Act” (FIPPA) was ratified by the parliament in 2002.Some specific enhancements introduced by FIPPA for foreign investment in Iran can be outlined as follows:
1-Broader fields for involvement by foreign investors including in major infrastructure,
2-Broader definition given to foreign investment, covering all types of investments from FDI to different types of project financing methods including :Civil Participation, Buy –Back arrangements, Counter trade and various BOT schemes;
3-Streamlined and fast track investment licensing application and approval process;
4-Creation of a one stop shop called the “Center for foreign investment Services” at the organization for investment for focused and efficient support for foreign investment undertaking in Iran,
5-More flexibility and facilitated regulatory practices for the access of foreign investors to foreign exchange for capital transfer purpose
- The 18h largest economy in the world by purchasing power parity (ppp)
- Consumption and the government plans billions of dollars worth of further investment to increase this share.
- The diversified economy and broad industrial base with over 40 industries directly involved in the Tehran stock Exchange is the industrial base in the MENA region.
- Resource-rich economy
- Labor-rich economy
- Young and educated population
- Large domestic market
- The Middle East market is a prime market opportunity for Iran’s non-oil exports
- An increasingly sophisticated infrastructure and human capital base providing the foundation for an emerging knowledge –based economy.
Oil & Gas
The Ministry of Petroleum of the Islamic Republic of Iran is responsible for all kinds of oil and gas activities. The Ministry by itself has got the four major subsidiaries body as follows which undertake implementation and operation of the above mentioned activities:
- National Iranian Oil Company (NIOC)
- National Iranian Gas Company (NIGC)
- National Iranian Oil Refining & Distribution Company (NIORDC)
- National Petrochemical Company (NPC)
The Iran’s Unique Position in terms of hydrocarbon reserves is as follows:
I. Iran is endowed with 155 billion barrels of oil equivalent to 10.9% of the global oil reserves.
II. Iran owns 18% of the global natural gas reserves equal to 34 TCM of natural gas.
III. Iran’s current exploration projects will lead to a considerable increase in the country’s oil and gas reserves.
IV. Presently, 62 onshore oil fields,16 offshore oil fields,20 onshore gas fields, and 2 offshore gas fields are in operation in Iran.
V. 26% of hydrocarbon reserves and 50% of natural gas reserves are located across Iran’s common borders with its neighbors.
National Iranian Oil Company (NIOC)
Since 1951, National Iranian Oil Company (NIOC) has been directing and making policies for exploration, drilling, production, research and development, refining, distribution and export of oil, gas and petroleum products.
NIOC, with a vast amount of oil and gas resources, is one of the world’s largest oil companies. At the present time, it is estimated that the company holds 155 billion barrels of liquid hydrocarbons and 29 trillion cubic meters of natural gas.
With advances in technology and increasing complexities of economic and political relations, NIOC has risen to a privileged status. Therefore, national and regional policies and cooperation with industrial countries in the provision in the supply of energy and stabilizing global oil markets are on the agenda of NIOC.
NIOC, in accordance with Article 44 of the Constitution, gives authority to different sectors, while supervising oil industry activities. The company has taken major steps toward establishing business enterprises, funded financial resources for development, helped to update technologies for exploration, drilling and production with reliance on the knowledge of Iranian experts.
NIOC consists of seventeen production companies, eight technical service companies, seven managements, six divisions (administrative units) and five organizational units.
National Iranian Gas Company (NIGC)
The growing need for gas to provide energy and fuel, and the foreign currency resulted from sales and export for investment and launching infrastructural industries in the country, reinforced the idea of bundling gas industry related activities. Therefore, in line with this, and based on the legal statute, NIGC as one of the four major subsidiaries of Iran’s Petroleum Ministry was established.
Since its establishment, NIGC has gradually achieved capabilities and has managed to have access to various sources and facilities such as experts and efficient human force equipped with scientific and theoretical vision and knowledge; tools, equipment, machinery and various advanced workshops for implementing its operations proportionate with the country economic and social development trend.
NIGC has also benefited from gas, which is one of the major fuels used for energy production and providing a part of the required currency of the country.
At present, NIGC is carrying out its tasks in compliance with international valid standards on its own.Right now, NIGC is one of the top ten gas companies in the gas industry in the Middle East, and one of the four major subsidiaries of the Petroleum Ministry. Being responsible for providing over 61 percent of the country- required fuel, it has over 45 years experience.The company, in terms of providing gas, has an important position both inside the country and abroad.
At present, the number of NIGC permanent staff amounts to 18000 persons; meanwhile, over 18000 contractor staff works with NIGC.
National Iranian Oil Refining & Distribution Company (NIORDC)
National Iranian Oil Refining & Distribution Company (NIORDC) was established in 1991, as one of the four main subsidiaries of the ministry of petroleum.
NIORDC as part of the National Iranian Oil Company (NIOC) was established on the principle of separating up-stream activities. It has 19 subsidiaries and affiliated companies, including 9 oil existing refineries. It offers its services using 22,000 experienced employees. In view of the increasing demand of petroleum, NIORDC is up to perform expanding, upgrading and optimizing projects for the existing refineries, and constructing new refineries.
In addition to crude oil refining, NIORDC’s activities are also focused on engineering, construction and transportation which embodied into three major subsidiaries: NIOPTC, NIOPDC and NIOEC.
Mission & Strategies
- Crude Oil Refining
- Crude Oil & Product Transfer
- Products Distribution
- Export & Import Of Oil Products
- Employing advanced technologies to boost efficiency
- Expanding Refining Capacity to give added-value to our crude oil
- Upgrade the quality of products to meet new environment requirement
- Growing presence in regional markets & collaborating with neighboring countries
- Attracting the participation of local and foreign private sectors in refining projects
- Expanding pipeline and storage networks to meet our import/export requirements
National Petrochemical Company (NPC)
National Petrochemical Company (NPC), a subsidiary of the Ministry of Petroleum is owned by the government of the Islamic Republic of Iran and is responsible for planning, organizing, developing, supporting and leading the country’s petrochemical industry. Founded in 1964, NPC began its activities by operating a small fertilizer plant. Petrochemical industry, as a global industry, plays a special role in Iran’s economy and is considered as the first exporter in the country as well as the second producer in the Middle East. Thus, NPC is committed to maintain and upgrade its place according to the country’s 20-year Vision Plan for 2025. To this end,reaching a production capacity of over 100 million tons through implementing developmental projects with an investment of 40 billion dollars has been set as the goals of the next 5-year Development Plan of the country’s petrochemical industry. This company believes that the most appropriate strategy for such development is participation of private/nongovernmental investors.
Quantity goals of the 5th five-year development plan (2011-2015)
- Number of top prioritized petrochemical projects: 69
- Required total investment: 498,000 billion Iranian Rials
- Total capacity: 117 million tons
- Production rate: 90 million tons
- Value of salable products: 44 billion Dollars
Qualitative objectives and policies
- Establishment giant petrochemical facilities on the southern borderline to easily accessing international markets.
- Utilization of optimized gas sources instead of oil as feedstock for petrochemical complexes.
- Increasing the share of nongovernmental investment in petrochemical industry.
- Applying and development new technologies in petrochemical industry.
- Establishment joint venture petrochemical facilities and service companies with right foreign companies.
- Increasing the utilization of ethane and natural gas in petrochemical facilities.
- Implementation new petrochemical complexes using methane and ethane as feedstock near the South Pars Special Economic Energy Zone to reduce expenses of transportation.
NPC strategic goals pivoting around its developmental/sovereign role
- Development to achieve the country’s 20-year Vision Plan.
- Increasing Petrochemical industry share in non-oil export.
- Sustainable development of petrochemical industry through Strengthening and completing value chain with a concentration expanding supplementary industries.
- Optimizing the use of local facilities and capabilities.
- Utilizing comparative-competitive advantages of local and foreign less-developed regions and special economic zones as well as free-trade zones (Chabahar, Kish, Queshm, Sarakhs, Lavan and …)
- Preparing the necessary grounds for local and foreign investment
Industry & Mining
Steel, weaving, food processing, car, electrical and Electronics Industries are among the key industries in the country.Iran now produces a wide range of manufactured commodities, such as telecommunications equipment, industrial machinery, paper, rubber products, steel, food products, wood and leather products, textiles, and pharmaceuticals. Iran is also known throughout the world for its hand-woven carpets. The traditional craft of making these Persian rugs contributes substantially to rural incomes and is one of Irans’ most important export industries
The pharmaceuticals, paper, sugar, packaging, and textile segments have been identified as key growth areas of the industrial sector by the Industrial Development & Renovation Organization of Iran.
Industrial output continued to grow into 2012, buoyed by the strong mining and steel sectors. Advances in aerospace and agri-business are also firming up the manufacturing sector.
- Iran produced 1.4 million cars from 2Q2011 to 1Q2012. Total sales, including imported and domestically produced vehicles, totaled $18.8 billion.
- A booming auto industry requires a booming auto parts industry. Iran has just that. Now supplying much of the industry’s needs, producers are ramping up exports.
Iran is rich not only in oil and gas, but in mineral deposits’, as well. Iran has the world’s largest zinc reserves and second-largest reserves of copper. It also has important reserves of iron. Uranium, lead, chromate ,manganese, coal and gold .In addition to the major coal mines found in khorasan razavi,kerman,semnan,mazandaran,and gilan, a number of smaller mines are located north of Tehran and in Azarbayjan and Esfahan provinces.
Deposits of lead, zinc and other minerals are widely scattered throughout the country. The mines at sar cheshmeh in Kerman province contain the world’s second largest lode of copper ore. The government owns %90 of all mines and related large industries in Iran and would like To attract foreign investment for the development of the mining sector. As per Article 44 of Constitution of Iran, the government has been actively promoting the privatization of all mines.
Iranian Mines and Mining Industries Development and Renovation Organization (IMIDRO) is the major state-owned holding company.
Although 90% of the country’s mines and related large industries are in state hands; the government has stated its intention to further develop the sector through private and foreign investment. Minerals targeted for investment include aluminum, copper, and iron ore. By the end of the current Five-Year Development Plan (FYDP), which began in 2010, the government expects to boost the mining sector’s contribution to GDP to 1.2% as well as boost total mineral production to 500 million tons. With 12% of the Persian Gulf region’s aluminum reserves, the implementation of development projects could boost production to 1.5 million tons by 2025 and turn Iran into one of the top 10 producers in the world. The private sector is also being mobilized to get the mining sector to work with modern equipment.
- There are approximately 5,000 mines in operation in Iran, with 12 metals and 36 non-metal ores currently being exploited.
- Increased investment and private sector involvement will see mineral production increase in the coming years as modern machinery and equipment are put to use.
- Iran is one of the top 10 global producers of iron ore, with over 35 million tons of output per year.
- Iran’s precious stones have become an object of admiration for onlookers as well as a profitable industry for the country as it aims to diversify its economic strengths.
- As one of the 15 most mineral-rich countries in the world, Iran enjoys export links with 159 countries, including Iraq, China, the UAE, India, and Afghanistan. Mining products represent over 30% of the country’s non-oil exports, and the sector also employs 100,000 people directly and up to half a million indirectly.
- Developments in the country’s base metals segment, including copper, aluminum, zinc, and lead, also continued over the last 12 months. Iran has the world’s biggest zinc reserves, second largest copper reserves, and ninth largest iron reserves.
- Iran is also rich in zinc and lead, with over 220 million tons of proven reserves. Production remains below 200,000 tons for zinc and lead, with just under half exported.
%80 of the income from producing and mining activities ,which is derived and declared by producing and mining enterprises of cooperatives of private sectors of whom exploitation licenses are issued , or with whom extraction and sale contracts are concluded, from the beginning of the year 2002,on words by relevant ministries ,shall be exempt from the tax set forth in the article 105 here of for a term of 4 years beginning from the date of exploitation or extraction the less developed regions ,the exemption shall apply to %100 of the income for a term of years.
Ministry of Roads and Urban Development of the Islamic Republic of Iran is responsible for all kinds of transportation. The Ministry by itself has got five important sub-sectors as follows which undertake implementation and operation of transport infrastructures:
- Company for Construction and Expansion of Transport Infrastructures
- Road Maintenance and Transportation Organization
- The Railways Company of the Islamic Republic of Iran
- Ports and Maritime Organization
- Civil Aviation Organization
– Considering the key role of transportation in economic development of the country especially foreign trade and transit operation, Islamic Republic of Iran approved in 2000 its general policies in transportation sector with focus on the following priorities:
– Establishment of transport system and regulating portion of each sub- sector through giving priority to the rail transportation and with regard to the following aspects:
- Economic considerations
- Decrease in energy consumption
- Decrease in environmental pollution
- Increase of safety
- Balancing between infrastructures and fleet, navigation equipment and demand
- Increase in productivity at the highest level through promoting transport modes and management and human resources and information.
-According to the country’s fifth Five-Year Development Plan (FYDP), the Iranian government allocated approximately $34 billion to the transportation sector in 2010. With renewed interest in connecting international points by land, sea, and air, the government had utilized about 80% of these funds by 2012.
-The amount of cargo and passengers traveling along these routes has increased significantly in the past decade, with airline companies seeing some of the largest growth. In 2011, 27 million travelers and businesspeople passed customs, and the government surpassed its passenger and cargo targets by over 100%.
-Rail and road networks are being focused on as the key for a streamlined transport corridor from east to west, and in 2012 there has been an increase in the number and quality of a variety of valuable connection routes both throughout the country and extending beyond its borders.
-Sea freight capacity has steadily increased since 2009, on a growth pattern that has been accelerated by better quality services and faster loading and unloading times. By 2011, Iran’s TEU handling capacity reached 2.8 million, up from 1.7 million TEUs in 2007. Over the same period, passenger traffic by sea displayed 21% growth, making Iran an increasingly accessible destination for a variety of both new and loyal markets.
Models of Transportation:
-In total, Iran’s road network covers a distance of 180,958 kilometers, with 9,124 kilometers of paved highways and freeways. In 2011, the government launched projects to construct 6,500 kilometers of additional roads, many of them designed to enhance the travel experience beetween major international cities and Tehran, as well as cut transportation costs and times.
– Islamic Republic of Iran has given a priority to construct, rehabilitate and upgrade the existing roads of Asian Highway Network and has made noticeable measures in this regard.
-Ministry of Roads and Urban Development has paied attention to public- private partnership in construction and completion of transport infrastructure projects. In road sector, many freeways, highways projects are being constructed or rehabilitated on BOT, Partnership or other methods.
– The rail network of the Islamic Republic of Iran is connected to middle East and Europe railways from West (Razi border), to Azerbaijan railway from North West (Jolfa border), to Caspian sea and ports of Turkmenistan, Kazakhstan, Azerbaijan and Russia from North (ports of Amirabad, Neka and Turkmenistan), to Central Asian, Russia and China railways from North East (Sarakhs border), to Pakistan railway from South East (Mirjaveh border) and to Persian Gulf and open seas of the world from South (Bandar Abbas and Imam Khomeini ports).
-Railroads currently stretch across 11,760 kilometers of the country, with 3,352 kilometers currently under construction. With a wider range and increasingly useful routes, passenger traffic increased 5.3% in 2011. In 2011, 27.7 million people used the country’s rail networks, and 32.8 million tons of goods were transported, accounting for 9% and 11%, respectively, of the country’s total transportation.
-In accordance with the fifth FYDP, the government intends to add 15,000 additional kilometers of rail to its existing network by 2015. To help achieve this goal, the Ministry of Roads and Urban Development worked to attract €17 billion in FDI, much of which will be used to expand the rolling stock of the Islamic Republic of Iran Railways (RAI) and its associate companies, Raja Passenger Train and Railway Transportation.
3- Civil Aviation :
-In civil aviation sector, there are 54 airport in the country ,which 8 of them are international
– Iran Air is the national carrier. Today, the company services 6 million passengers per year, many of them flying on one of the 100 daily domestic flights to 28 destinations.
– Domestic passenger traffic has increased by an average of 7% over the last 10 years, and at the same time international air travel in Iran has grown by a robust 9% per year, which is far above the world average.this growth trend will continue for at least the next few years. With 3,300 employees and growing, the expansion of the business may lead to a bright future.
-promotion of capacity of ports of Chabahar and Shahid Rajaee in South and Amirabad in North as well as establishment of shipping lines in the region are among measures taken in the framework of transport cooperation vision which shall deeply affect transportation and trade in Asia and the Pacific.Ports of Shahid Rajaee, Amirabad and Anzali enjoy outstanding location in transit route of the North- South corridor. In addition, ports of Imam Khomeini, Shahid Bahonar, Lengeh, Boushehr, Chabahar and Noshahr have got their own unique potentials.
-The nominal capacity of commercial ports grew to over 150 million tons in 2010-2011, marking an increase of 5.6% over the previous period.
Leading this growth is Bandar Abbas, Iran’s main container port in the country and largest hub in the Persian Gulf. In 2010, the port’s cargo ally and 52traffic reached 2.5 million TEUs, accounting for nearly 95% of the country’s total TEU handling activity. In addition, the port accounted for 37% of the country’s total transit traffic in 2011.
-Islamic Republic of Iran has targeted in transit sector in a way that it shall reach to figure of 40 million tons of goods by the end of Fifth Economic Development Program (2015).
Agricultural is one of the most important sectors of the Iranian economy, accounting about 11%of GDP, 23%of the employed population and 15%of the foreign exchange revenues (form nonoil exports). Agricultural and animal husbandry products have always provided the major non-oil export items such as pistachios, raisins and even carpets (the wool or silk used in them).
About %20 of the land Iran is arable .the main food-producing areas are in the Caspian region and in valleys of the northwest. Some northern and western areas support rain-fed agriculture, while other areas require irrigation for successful crop production.
Agri-food & Packaging
- Iran is one of the most populous countries in the region, and so there was a real long-term strategic intent from the side of international companies to make an entry into this market
- A total of 12,198 entities are engaged in the Iranian food industry, or 12% of all entities in the industry sector. The sector also employs approximately 328,000 people or 16.1% of the entire industry sector’s workforce, according to the Iranian Food Industry Organization.
- Investments now total $7.7 billion, or 18% of total investment in the industry sector. Sector exports range around $1 billion per year, and the main export items are confectionary, dairy products, tomato paste, fruit juice and concentrate, mineral water, and pasta.
- The main export regions include the Middle East, Central Asia and other CIS nations, Europe, and South America. The country is also increasingly importing food technology, including processing and packaging equipment.
- The beverages sector is growing quickly in Iran as part of an expanding FMCG scene. As local consumption increases, players in the sector look to gain market share while improving supply and quality.
- The income derived from all agriculture and horticulture activities, fish farming, bee-keeping, hunting and fishing, sericulture, revival of pastures and forests, is exempt from payment of tax. All the natural and juridical persons (Iranian and Foreign) can enjoy above mentioned exemption at the outset their activities.
- 100% of the income derived exportation of industrial finished goods and products of agricultural sector(including forming ,horticulture husbandry, poultry ,fishery, forest and pasture products) and its conversional-signal and complementary industries and also %50 of the income earned from exportation of other goods that are exported for achieving the objectives of the exportation of non-oil goods, shall be exempt from tax. A List of goods subject to this article, in the course the of each development plan based on proposal of the ministries of economic affairs and finance, commerce, jihad-e-agricultural and industries and mines, shall be approved by the council of ministers.
For more information visit this site:
www.tpo.ir (expand trade organization)
The Iranian ICT sector, a keystone of the country’s non-prime economic expansion, is set for exponential growth thanks to its unique combination of demographic and economic variables.
A major engine of this growth is undoubtedly Iran’s population, which is large, young, and quick to pick up new technologies. Of Iran’s 73 million citizens, 70% are under 30 and 80% are literate.
A consistently increasing level of disposable income is creating a consumer class, while new players and technologies are helping to build sophistication and demand among them. It is estimated that consumer expenditure on telecoms equipment will reach $500 million and expenditure on services will hit $6 billion by 2014.
In the context of low penetration in strategic ICT areas, this formula portends the exponential growth.
Iran’s mobile phone penetration is 129%, representing the fact that many Iranians have more than one phone or subscriber identity module (SIM); however, the number of smart phones on the market remains relatively low. There are an astounding 23 million internet users in Iran, but only 2 million have access to broadband.
Iran is by far the biggest market in the Middle East for mobile phone subscriptions, with 90 million by end-2012. In terms of revenue, it is the fourth most lucrative market, in the region of $9.2 billion. Its estimated growth rate of 6%- 7% per annum puts it among the top-five countries in the world.
According to the Electronic Journal on Information Systems in Developing Countries (EJISDC), the sector employs 150,000 people and accounts for 1.3% of GDP.
Rural expansion has been a key element in the government’s growth strategy, and the country was recently awarded the UNESCO special certificate for developing telecommunication services in rural areas. The current administration is targeting to provide computers and internet to every school in the country.
Iran’s mobile telephone segment is the centerpiece of its ICT sector. The current level of 90 million subscribers is up sharply from 68 million at the end of 2011 and 35 million in early 2008. The vast majority of subscriptions are in the form of pre-paid users.
The data segment is now seen as the key driver of the industry, as players vie for various 3G technology rights.
Data’s share of the total revenue is expected to double over the next five years reaching $4.5 billion by 2014. By the end of 2009, Iran’s mobile telecoms market was the fourth-largest market in the region at $9.2 billion and it is expected to grow to $12.9 billion by 2014 at a compound annual growth rate (CAGR) of 6.9%.
Mobile and internet
There is substantially more competition in the internet arena, where 11 private access providers (PAPs) and TCI vie for market share, offering ADSL2+, WiMAX, and other fixed wireless broadband services.
Iran currently has only 2 million high-speed internet users, compared to 7 million in similarly sized Turkey to the North West.
The government’s fifth Five-Year Development Plan (FYDP) calls for the establishment of a fiber-based national broadband network by 2016.
Recognizing the role of multilateral broadband development in the nation’s economy, the Iranian government has also awarded significant WiMAX tenders to private players in recent years.
Impressive archaeological sites, carefully planned museums, and ecological wonders await the curious traveler in Iran, a country that has something for everyone.
Iran successful domestic market has laid the groundwork for an increased amount of foreign visitors interested in the history, natural beauty, and business opportunities Iran has to offer.
Travelers seeking to delve deep into history and the origins of civilization need look no further than Iran, where a mosaic of cultures and natural landscapes transcends the perception of the country in the international arena.
Iran’s Cultural Heritage, Handicrafts, and Tourism Organization (ICHTO) is the related authority in Iran.
With the goal of capitalizing on the already productive domestic market, ICHTO has identified 1,200 Tourism special Zone that investors can take advantage of it .With the support of OIETAI, ICHTO aims to attract a much larger FDI figure to the tourism industry in 2013.
Iran’s Potentials in Tourism
- 15 UNESCO World Heritage sites
- 10th Country on Tourism Attractions and 5th on Ecotourism
- One of the rich countries of the cultural places, ecotourism sites and historical monuments which called the cradle of civilization in other way the history of the Country goes back to 7000 written history
- An array of museums
- Amyriad of ecotourism opportunities
- Numerous religious sites
- Affordable healthcare services
- Extensive bus network and air and rail infrastructure in the country
Until now, UNESCO has designated 15 of Iran’s various historical and natural sites as part of world heritage; includes:
especially for those interested in religious history it is estimated that there are more than 28 messengers of God have tombs throughout Iran.
Some of top sites are as below:
- Persepolis, the complex of Xerox palaces having the detail of 2,500 year-Old Persian reliefs.
- The ancient Mesopotamian ziggurat and complex of Chogha Zanbil is an intriguing remnant from the Elamite Empire more than 3,500 years ago which stand as a testament to the feats of ancient engineering.
- Soltaniyeh Dome, recognized as a UNESCO World Heritage site in 2005, is an architectural masterpiece that was built in 1302 AD. As the oldest double-shell dome in the country, the structure paved the way for construction of holy buildings throughout the Muslim world and has captivated the attention of both pilgrimsand historians for centuries.
The Iranian government has established a number of museums to showcase artifacts and present the stories of civilization to an international audience
- The Treasury of the National Jewels in Tehran, the National Museum, Golestan Palace in Tehran, and the Sheikh Safi Museum in Ardabil are just a handful of venues that feature the collage of Iran’s historical and traditional past.
- In addition, Tehran’s Contemporary Art Museum showcases over 7,000 texts in both Persian and English as part of a specialized library.
- Iran’s natural beauty and conservation efforts are nothing short of impressive. Stunning waterfalls, deserts, forests, lagoons, caves, swamps, and lakes represent a diverse array of climatic zones and landforms, comparable only to the continental US.
In total, the country boasts 28 natural parks,43 protected wildlife zones, and 166 protected areas, committing nearly 5% of its land-an area of 8 million hectares-to ecotourism and the preservation of natural resources. Among the most popular destinations for eco-holidaymakers are Galestan National Park, Kavir National Park, Lar Protected Area, Bakhtegan Lake, and Bamou National Park.
Sea and Coastline:
Due to the extensive bus network and air and rail infrastructure in the country, domestic tourists most often travel to visit friends and family during the summer months. Given the country’s abundant natural beauty and coastal destinations, approximately 24% of domestic tourists traveled for sightseeing or entertainment purposes in 2011. However, medical tourism and pilgrimage make up an additional 23% of travel throughout the country.
In addition to beaches 700 Km alongside the Caspian Sea are the most popular destinations for domestic tourism.
The city of Mashhad, visited by the Muslims to pay homage to the Holy Shrine of am Reza, the largest mosque in the world by area which accommodates 20 million pilgrims and tourists every year. Other notable holy sites include the
Danial-e Nabi Mausoleum, one the messengers of God in shosa,
Shrine of Hazrat-e Masumeh, the sister of and the Chak Chakoo Fire Temple, which is famous for the legendary dripping water that falls from surrounding rock formations.
Plans for Future:
As part of Vision 2025, the government aims for Iran to achieve a stronger position among global tourism destinations, setting a target of 7.5 million foreign arrivals.
Although the number of international arrivals has been steadily increasing-up from 2.2 million people in 2009 to 3.6 million from in 2011 at a growth rate of 58% domestic tourism is a key segment of the sector overall.
A large majority of Iranians frequently travel within the country on a yearly basis, and although they do not typically inject as much money into the economy as foreign tourists are known to contribute, the development of transportation and communications infrastructure is fueled by the large amount of domestic traffic.
The overall goal of the Tourism industry is to attract 2% of the world’s tourists, or 20 million people, to Iran by 2025. In 2011, the country earned approximately $6 billion from the tourism sector, and in 2013 analysts expect the tourism industry to grow by a significant 135%.
There are huge potentials for investment in health infrastructures due to Iran’s capabilities in health tourism. Iranian doctors are among the best in the world. Dentistry is highly advanced and Iran has the potential to become a medical tourism destination. The government has eased the process of developing these platforms as it sees the potential for high returns on investment thanks to the tourism potential the country possesses.
Iran’s interest in nanotechnology and biotechnology has prompted the establishment of a variety of specialized care facilities, including institutions focused on optometry and organ transplants.
Education and up-to-date equipment supports distributors, while working with active pharmaceutical ingredients has supported the profitability of the sector.
Experiencing 23%-25% growth per year, the pharmaceuticals industry is a key driver of the healthcare sector overall. Focusing on the production of high-tech medicines that can be exported to emerging markets, pharmaceutical companies are working to meet demand and maintain growth. In 2011, the domestic market was worth $4.5 billion.
An exceptional workforce and a booming pharmaceuticals industry have spurred growth in Iran’s healthcare sector in recent years.
Investments in biotechnology and nanotechnology characterize the industry, with local manufacturers focused on offering high-tech products to the domestic market as well as developing countries abroad.
Structure of Health Sector in Iran
Three fundamental pillars support Iran’s highly centralized healthcare sector: public and governmental entities, private providers, and NGOs. Expenditures for the healthcare sector were pegged at $31.7 billion in 2012, and that figure is estimated to reach $50 billion by end-2013. The government has consistently invested approximately 5% of GDP in the sector annually during recent years.
Nearly every decision made regarding the sector’s goals and policies is made by the Ministry of Health and Medical Education (MOHME), which exercises the executive responsibility for health care within the framework of the Iranian government. MOHME has the legal authority to oversee, license, and regulate the activities of the private health sector.
Some facts and statistics:
With over 830 medical institutions and more than 110,000 beds, the local medical network is prepared to accommodate region’s growing population.
Over 85% of the 6,200 generic-branded pharmaceutical products in Iran are produced locally.
Foreign products, imported by 75 companies, are processed at 20 main import centers before being registered on the Iranian market.
In terms of medical and health care tourism, Iran boasts the distinct advantage of well-educated professionals and affordable costs. As one of the most advanced countries for health care and technology, many investors have seized the opportunity to establish operations and medical facilities in Iran; the year 2012 saw the arrival of approximately 30,000 medical tourists.
Although leisure, business, and healthcare tourism opportunities are blossoming in Iran, ICHTO has identified key areas for improvement. Among its aims is the need for greater tourism promotion abroad, and the organization has launched a campaign to attract international tour agencies and build better infrastructure for the expected increase in international arrivals. “We currently lead $500,000 worth of projects for the development of tourism infrastructure. After the completion of over 800 projects, we will witness tremendous growth,”
Foreign Investment Service Center
The Center for Foreign Investment Services (the Center)was established at the premises of the Organization for Investment, Economic and Technical Assistance of Iran, pursuant to Article 7 of “ The Foreign Investment Promotion and Protection Act” of 2002. The Center is intended to provide an efficient organization for streamlining and expediting the affairs related to foreign investment undertakings in Iran. For this purpose, fully authorized liaison representatives from relevant executive agencies including the Ministry of Foreign Affairs, the Ministry of Commerce, the Ministry of Labor and Social Affairs, the State Organization for Tax Affairs, the Customs of the Islamic Republic of Iran, the Central Bank, the General Directorate for Registration of Companies and Intellectual Property, and the Organization for Protection of the Environment have been stationed at the Center. These representatives will assist foreign investors by ensuring efficient execution of the processing and services entrusted to their relevant agencies in connection with foreign investment projects.
Key services offered by the Center include:
- Dissemination of information and provision of necessary guidance to foreign investors concerning investment in Iran.
- Necessary coordination concerning the issues related to foreign investment including issuance of the declaration of establishment , the environment protection license, the permits for subscriptions relation to water, electricity, fuel and telephone, the license foe exploration and exploitation of mines, etc. from the relevant authorities, prior to the issuance of the investment license.
- Necessary coordination for the securing of entry visa, residence and employment permits for foreign nationals involved in foreign investment projects.
- Necessary coordination concerning issues related to foreign investments subsequent to the issuance of the investment license including registration of joint venture company, registration of order for importation of machinery and equipment, and issues related to importation and repatriation of capital, customs and tax affairs ,etc.
- Coordination among various official agencies in connection with requests and applications made by projects involving foreign investment.
- General supervision concerning the fulfillment of decisions surrounding foreign investment projects.
Conduct of affairs related to foreign investment by the Center has been organized in a manner that foreign investors can easily lay hand on all required information and services without any need for further referral to a host of different executive bodies. In fact, services rendered by the Center are not limited to prior-investment stages; foreign investors may, at any time and any stage ever after, refer to the Center and benefit from its services.
The performance of the Center since its establishment proves that the establishment of the Center is an effective step toward expediting the affairs of foreign investment undertakings. It is expected that further development of relations between the Center and foreign investors will increasingly enhance the efficiency of the Center in carrying out its assigned duties and responsibilities.
The Centers with the same tasks mentioned above established in the center of all provinces.
Investment Licensing Procedure
Documents Required by the OIETAl for the Isuance Of Foreign Investment Licensing Procedure
- Application Form
- Establishment License / Primary agreement / Preliminary agreement of the pertinent Iranian organization
- Official letter of the foreign investor to submit to the OIETAl
- The foreign investors background including a brief history of the company ,the year of establishment area of activities in case of foreign investor is a natural person , a photocopy of passport and resume will be provided.
- A list of machinery, equipments and CKD part which may be imported into the country as a part of the foreign investors capital (if available).
- In case that part of the foreign investor’s share is in the form of technical know –how, a draft of the contract outlining the conditions of the transfer of technology.
- Any further useful information.
Employment of Foreign Nationals in Iran
Foreign nationals are prohibited from working in Iran unless they receive work and employment permits (even if they are supposed to receive wage and salary outside the Iranian territory). The work permit serves as the employment license for the foreign nationals in Iran.
The work permit for the employment of foreign nationals in Iran is issued by the “Department General for Employment of Foreign Nationals” (also called Department for Employment of Expatriates) of the Ministry of Cooperatives, Labor and Social Welfare upon a request by Iranian employers. In provincial capitals it is issued by the Foreign Citizens Divisions of the Department General of Cooperatives, Labor and Social Welfare. (The general procedure for admission of foreign investment has been brought separately in the following part.) The Iranian employers are obligated to seek the permission of the Department General for Employment of Foreign Nationals before concluding any contract that may lead to the employment of foreign citizens in Iran. The rules and regulations for acquiring work permit for the foreign nationals are available in the Labor Law of the Islamic Republic of Iran, ratified in 1990 (articles 120 through 129 and executive bylaw of Article 129). Although due to abundance of educated job-seekers in the country and for the purpose of reducing unemployment rate of the educated and skilled job-seekers the Technical Board for Employment of Foreign Nationals has strict rules and regulations (stipulated in Article 121 of Labor Law) for issuance of work permits, the Foreign Investment Promotion and Protection Act (FIPPA), passed in 2002, has considered promising provisions for issuance of work permits for foreign investors, managers and experts in relation with the investments under FIPPA.