Minister of Economy Reports Budget Shortage and Withdrawal from the National Development Fund

The Iranian Minister of Economy and Finance announced that the budget for the year 1403 is facing a deficit, and to compensate for this shortfall, part of the public budget has been allocated to targeted subsidies. Abdolnaser Hemmati explained on Tuesday, October 9, during a public session of the Islamic Consultative Assembly, that the budget shortfall was supposed to be covered from the targeted subsidies, but this section is also facing a significant deficit, leading to the allocation of part of the public budget to targeted subsidies in the first half of the current year. Mr. Hemmati also pointed out that the government is facing a budget shortfall in securing resources for Article 18, which is dedicated to production and employment, but banks have expressed their readiness to help resolve this issue. With the approval of Khamenei, the share of the National Development Fund from oil and gas revenues has been halved this year. The Minister of Economy announced that the cash balance of the National Development Fund in 1402 is only 2 trillion tomans, while the rest, equivalent to approximately 24 trillion tomans, is in securities. In conclusion, Mr. Hemmati stated that to compensate for the budget deficit, withdrawals have been made from the National Development Fund, and permission for this has been obtained from Ali Khamenei, the leader of the Islamic Republic. This comes at a time when Mehdi Ghazanfari, the head of the National Development Fund, had previously criticized the repeated withdrawals from this fund, stating that the parliament approves a budget beyond the country's foreign exchange capacity, forcing the government to withdraw from the National Development Fund to cover the budget deficit. Additionally, the Research Center of the Parliament published a report last year showing that the thirteenth government not only did not pay its 25 trillion toman debt to the National Development Fund in 1401 but also, with the permission to withdraw 20% of the resources of this fund in 1402, added approximately 170 trillion tomans more to this debt. While the National Development Fund was supposed to lend more to the private sector, the public sector has so far made the most withdrawals from this fund, with over 101 billion dollars withdrawn by various governments out of a total of 160.8 billion dollars in resources of this fund.