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Why should I invest in Iran

Iran qualifies from many respects to be a good location for investment and doing business. it has huge potential for investing after the termination of economic sanctions, Some of the features are highlighted below:
1. Vast domestic market with a population of 80 million growing steadily 2. Young, educated and cheap labor force 3. Excellent strategic geographical position 4. The quick and easy access to neighboring markets with a population of 350 to 400 million 5. Developed and ready infrastructure 6. Cheap and abundant raw materials, energy and transportation 7. The four-season climate and climate variability in the country 8. Fiscal incentives 9. Security and political stability 10. Untapped and consumer market ..

Corn plantation in Azadshar in Iran's northern Golestan Province
Corn plantation in Azadshar in Iran’s northern Golestan Province

Iran is exploring overseas resources to ensure stable supplies of agricultural products for a rapidly urbanizing population in the face of the constraints of worsening land and water resources.

The semi-arid state has been investing in large areas of farmland overseas, where contracts for cultivation on nearly 800,000 to one million hectares in a number of countries have been signed and approved by the government, according to Agriculture Minister Mahmoud Hojjati.

“Due to the paucity of water resources, the government is seriously pursuing an overseas farming plan for some commodities, including grain corn and oilseeds,” the minister has said.

Kazakhstan, Ukraine, Brazil and Ghana have been cited in the media among the places which Iran was pushing for long-term leasing or ownership of farmlands with higher agribusiness potentials.

On Saturday, Brazil’s deputy Minister of Agriculture, Livestock, and Food Supply Aomar Roberto Novak told IRNA that Iranian farming was possible in his country and that companies from the two sides had to negotiate and reach a conclusion.

A canola field in Gavdasht in Iran’s northern Mazandaran Province

Across the border, Azerbaijan is the latest country where Iran has been carrying out agricultural projects in more temperate climates.

Rahim Motaharnejad, managing director of Hami holding, a non-governmental support group, said Iran had started cultivation of grain corn on 250 hectares, which was successful.

There are now plans for this year to carry out the project on a larger scale in partnership with Azerbaijani companies, he said.

Under the contract, the Azerbaijani side will provide land and supply water and the Iranian companies will contribute technical knowledge and management.

“We are following two goals: bringing in foreign exchange to the country through supply of products to the Azerbaijani market and producing certain commodities for domestic use such as barley and alfalfa,” Motaharnejad told IRNA.

His company is also pursuing agricultural projects in Ukraine which has plenty of water and very fertile land, “but we need the support of the government of the Islamic Republic of Iran,” he added.

Iran relies on imports for 90% of its requirements for water-intensive products such as wheat and oilseeds. Other water-guzzling crops such as watermelons have a steady army of critics in a country where aquifers are critically overdrafted.

A watermelon farm in Iran’s southern Hormozgan Province

On Monday, Tasnim cited state statistics indicating that Iran had exported 500,000 tonnes of watermelons, worth $100 million, in the five months since March.

Iraq, the UAE, Turkey, Kuwait, Afghanistan, Qatar and Oman were the biggest receivers of Iran’s watermelon shipments, a summertime staple to quench thirst in sizzling temperatures.

Other clients of Iran’s hydrating treat were ironically the countries with more abundant water resources such as Sweden, Poland, Hungary, Belarus, Germany, Albania, Georgia, Azerbaijan, Uzbekistan and Pakistan.

For years, Iran has been trying to modernize its farm sector and rebalance output toward dry farming and value-added crops which are increasing in demand among its population of over 80 million.

Farmers tilling a farm in Iran’s central Isfahan province

Current farming methods include open-land agriculture and green-house production but more modern practices such as hydroponics, a soil-less culture technology which uses less water and land, have yet to be introduced.

Iran exported its first consignment of wheat after many years this year, with state officials cheering it as a sign that the country’s plans to attain self-sufficiency in production of the strategic staple had materialized.

Results from state purchases from Iranian wheat growers so far this year are also robust, and buys of 8.8 million tonnes have already been secured, according to officials.

Food security is a key policy area for global state planners, and for Iran, it is additionally crucial in the face of a protracted drought where falling water tables are adversely affecting harvests and the basket of agricultural products is narrowing.

Food prices were a key driver of Iran’s double-digit inflation which shot over 40% under former president Mahmoud Ahmadinejad.

China's CITIC Group has signed an agreement with five Iranian banks to provide a credit line of $10 billion for Iran's infrastructure projects.
China’s CITIC Group has signed an agreement with five Iranian banks to provide a credit line of $10 billion for Iran’s infrastructure projects.

China has signed an agreement with Iran to provide a credit line of $10 billion for its infrastructure projects – what is seen as the biggest economic deal between the two countries after the removal of sanctions against the Islamic Republic in 2016.

The agreement was signed between China’s CITIC Group Corporation and a consortium of Iranian banks that included Bank of Industry and Mine, Refah Bank, Parsian Bank, Bank Pasargad and Export Development Bank of Iran.

Based on it, CITIC would provide loans to the Iranian banks to fund projects in areas such as energy, natural environment, transportation and the management of water resources.

Valiollah Seif, the governor of the Central Bank of Iran (CBI) who oversaw the signing of the agreement, was quoted by media as saying that the Iranian banks could start receiving loans from CITIC as early as October.

Seif emphasized that the CBI had shown “extensive flexibilities” toward CITIC in sealing the agreement. He added that this was based on the bank’s history of positive cooperation with the Islamic Republic without elaborating what those flexibilities constituted.

The Beijing-based CITIC Group Corporation, formerly the China International Trust and Investment Corporation, is a state-owned investment company established in 1979. It now owns 44 subsidiaries, including China CITIC Bank, CITIC Holding, CITIC Trust Co. and CITIC Merchant Co. Ltd in China, Hong Kong, the United States, Canada, Australia and New Zealand.

Iran media last September quoted a CITIC official as saying that the enterprise was considering to provide Iran with $10 billion of financing, mostly in the country’s steel, copper and coal projects.

The official, identified as Zhou Yafang by the English-language newspaper the Financial Tribune, added that the Chinese government was expected to issue the required permits by the end of 2016 and that the financing process would start in 2017.

Zhou had also emphasized that the financing is fully backed by China Export and Credit Insurance Corporation known as Sinosure.

 

Iran’s Kish Airline has announced an ambitious plan to purchase over a dozen new planes from global aviation giant Airbus and Boeing.
Iran’s Kish Airline has announced an ambitious plan to purchase over a dozen new planes from global aviation giant Airbus and Boeing.

Iran’s Kish Airline has announced an ambitious plan to purchase over a dozen new planes from global aviation giant Airbus and Boeing.

Kish Airline CEO Mohammad Taqi Jadidi was quoted by the domestic media that the plan envisaged buying 10 planes from Boeing and 6 more from Airbus.

Jadidi told Iran’s IRNA news agency that the new Airbus planes would be added to his company’s fleet before the end of the current Iranian calendar year (21 March 2018).

He added that Boeing planes would be purchased in the next Iranian year.

Nevertheless, the official did not specify which specific models the purchases would involve.

Kish Airline belongs to Kish Free Zone Organization and currently has 14 planes, including 2 Airbus-320, 2 Airbus-321, seven MD planes and 3 Fokker-100 planes, IRNA added in its report.

Airbus has already sealed deals to sell a total of 173 new aircraft to Iranian airlines with a collective value of tens of billions of dollars.

On the same front, Boeing had accrued orders and options for 140 planes, while the smaller European turboprop-maker ATR attracted orders and options for 40 aircraft.

Iran Air – the country’s national flag-carrier airline – appears to be the most active buyer of new planes. The company would buy a total of 220 new planes from Airbus, Boeing and ATR, covering both wide and narrow-bodied jets as well as turboprops. Airbus and ATR made their first deliveries of several planes over the past few months but Boeing deliveries would start in 2018.

Among the country’s smaller carriers, Iran Aseman Airlines would buy 30 new Boeing 737 Max 8 jets, with options for 30 more.

Iran Airtour would also purchase 45 Airbus A320neo aircraft.

And Zagros Airlines would acquire 28 Airbus aircraft, including 20 of its A320neo model and eight of its larger A330neo.

Iran says international air traffic over its skies has reached above 1,400 planes per day in what is believed to be a result of growing confidence in the country’s safe airspace.
Iran says international air traffic over its skies has reached above 1,400 planes per day in what is believed to be a result of growing confidence in the country’s safe airspace.

Iran says at least 1,400 planes cross its skies everyday – an announcement that a top military official in Tehran says is a proof of the country’s airspace security for regional and transregional airliners.

“Today, Iran has been chosen [by airliners] as the safest air corridor in the Middle East,” Brigadier General Farzad Esmaili, the commander of Iran’s Air Defense Force, was quoted as saying by the domestic media.

The official added that over 700,000 international flights carrying a collective of above 50 million passengers had used Iran’s skies over the past Iranian calendar that started 21 March 2016.

Official figures show around 450 planes crossed Iran’s skies every day in 2014. However, the insurgency that Daesh militants waged in Iraq as well as the conflict in Ukraine pushed the number up to as high as 900 planes per day the next year, marking an increase of 100 percent.

The diplomatic crisis between Qatar and Saudi Arabia and its allies forced the tiny Persian Gulf state to use Iran’s airspace for its international flights.

Accordingly, officials said this introduced an increase of 20 percent in Iran’s air traffic.

The rise in Qatar’s use of Iran’s airspace has also provided the Islamic Republic with extra air transportation fee revenues. To the same effect, the domestic media said Iran was entitled to at least $13 million per month in air traffic fees.

In June, Saudi Arabia, Oman, Kuwait, Bahrain, and the UAE closed their airspace to the Qatari planes after they cut diplomatic ties with the country, accusing the latter of supporting terrorism.

The Iranian railway on the Gorgan-Gonbad-e Kavus route
The Iranian railway on the Gorgan-Gonbad-e Kavus route

A Russian bank has agreed to provide 1 billion euros to electrify a 500 km railway route in northern Iran, state news agency IRNA has quoted a senior official as saying.

Head of the Islamic Republic of Iran Railways for northern network, Yusef Gheranpasha, said the bank will finance the electrification of the line between the cities of Garmsar and Gorgan.

“With the agreement of the Russian bank to provide finance, the project will soon be put into the implementation phase and become operational within three years,” the official said without identifying the lender.

The loan is related to a 1.2 billion euro deal that Russia and Iran signed to electrify the Garmsar to Inche Burun line during a visit by Russian President Vladimir Putin to Tehran in November 2015.

The railway line extends into Turkmenistan and Kazakhstan, linking Central Asia to the Persian Gulf and beyond.

Russian Railways officials have said the company will start the project in 2018. The contract covers design, sourcing of materials and equipment and construction of 32 stations and 95 tunnels, 7 traction substations, 11 section pillars, 6 duty posts of the contact station and the power supply administration building.

Russia will be financing the project as part of its $5 billion credit line for infrastructure projects in Iran. Russian state lender Vnesheconombank will grant another 2 billion euro export loan to the Islamic Republic.

The news came amid the World Bank’s announcement that it was not currently looking to finance any projects in Iran.

“We are not considering financing any projects in Iran right now,” Reuters quoted an unnamed World Bank spokesman as saying Tuesday.

The Russians have also announced readiness to electrify the 600 km railway route between Tehran and the northwestern city of Tabriz, which is also eyed by the Germans and Italians.

The Tabriz-Jolfa route in northwestern Iran is currently the country’s only operational electrified railway line.

Last month, Russia’s largest manufacturer of locomotives and rail equipment, CJSC Transmashholding, signed a 2.5 billion euro deal with IDRO Group in Tehran for joint production of rolling stock in Iran.

Transmashholding will hold an 80% stake in the joint venture, taking over Iran’s Wagon Pars Company to produce railroad cars in the country.

It was among the biggest contracts which Iran has signed with international companies after the removal of sanctions on the Islamic Republic.

In July, Iran signed another deal worth 1.2 billion euros with Italy’s state railway company Ferrovie dello Stato (FS) to build a high-speed railway between the central cities of Arak and Qom.

Later in the month, French transport company Alstom signed a joint agreement for the construction of subway carriages in Iran.

The Export-Import Bank of China (EXIM) also signed a $1.5 billion deal to finance the electrification of a high-speed rail line between the Iranian cities of Tehran and Mashhad.

The projects are part of Iran’s $25 billion investment roadmap over the next 10 years to modernize and expand the country’s railway network.

Under the plan, Iran seeks to stretch out the nationwide railroad line to 25,000 kilometers by 2025 from under 15,000 kilometers now.

MAN Diesel & Turbo, a German multinational that produces engines and turbo machinery, says it is paying a serious look at Iran’s investment potentials.
MAN Diesel & Turbo, a German multinational that produces engines and turbo machinery, says it is paying a serious look at Iran’s investment potentials.

MAN Diesel & Turbo, a German multinational that produces engines and turbo machinery, says it is paying a serious look at Iran’s investment potentials, saying it has already taken measures to restart its business in the country.

“We are very active in Iran. We’ve restarted our company there, called MAN Iran Power. We are now building a workshop there, I just signed a lease on the shed (a place where engines or turbines are designed and tested),” Gaby B. Hanna, vice-president and regional head of MAN Diesel & Turbo, was quoted as saying by media.

“We see Iran, putting aside all the political issues, as a big market for us,” Hanna was quoted as saying by the Gulf News. “The biggest growth market for us.”

Part of the Volkswagen Group, which is set to start exporting cars to Iran this month after 17 years away from the country, MAN Diesel & Turbo is ensuring that it is fully compliant with all regulations when dealing with Iran, added the report.

To the same effect, Uwe Lauber, CEO of MAN Diesel & Turbo, noted that Iran was a very important market before sanctions were placed on it.

However, due to the freeze on business dealing with Iran, the country had been forced to turn to China and South Korea.

“Over the last couple of years, nothing has been invested. And of course, during the sanctions, we were not able to serve our customers … and to keep plants operating, the Chinese and Koreans were there,” Lauber said.

New CEO of national flag carrier Iran Air Farzaneh Sharafbafi
New CEO of national flag carrier Iran Air Farzaneh Sharafbafi

Iran is in the process of selecting financiers for the purchase of 200 new passenger aircraft from among many domestic and foreign companies which have submitted their proposals to Iran Air, the new CEO of the national airline Farzaneh Sharafbafi said Tuesday.

Sharafbafi became the first Iranian woman in July to take the helm at Iran Air which has signed deals with Airbus and Boeing as well as Franco-Italian aircraft manufacturer ATR for the purchase of new brand passenger planes.

“Many proposals have been submitted to Iran Air and a preliminary decision will be made in the next month,” she told IRNA news agency.

ATR, a joint venture between Airbus and Italian company Leonardo which signed a firm contract with Iran Air for 20 turboprop aircraft and options for a further 20 planes early this year, is even willing to finance the purchases, Sharafbafi said.

Iran Air received four ATR 72-600s planes earlier this year, with the deliveries of the other aircraft to be completed by the end of 2018.

The logo of Iran Air is pictured as the company takes delivery of the first new Western jet in Colomiers, near Toulouse, France, January 11, 2017. (Photo by Reuters)

“There is no problem financing these planes, and Iran Air has bought all the 20 ATR aircraft in the form of hire purchase, and now proposals for financing these purchases are under review at Iran Air,” Sharafbafi said.

The purchases are part of Iran Air’s plans to rebuild the airline’s fleet after nuclear-related sanctions against Iran were lifted last year.

The company struck a deal with Boeing in December for 80 passenger planes. In January, Iran Air signed agreements to buy 118 planes from Airbus, before cutting the number to around 100.

Iran Air has taken delivery of three Airbus jets and will get another by the year-end, while the first Boeing is due around May 2018.

According to Iran’s Deputy Minister of Road and Urban Development Asghar Fakhriyeh-Kashan, given the type of Iran Air’s orders, the total value of the three contracts for the purchase of 200 aircraft from Airbus, Boeing and ATR is less than $18 billion.

Iran Air has undertaken to make an advance payment of $1 billion to Airbus and Boeing for the purchases, which will be reimbursed over a period of four years, he said recently.

Iran says it has started a new round of talks with the European planemaker Airbus over the purchase of dozens of helicopters.
Iran says it has started a new round of talks with the European planemaker Airbus over the purchase of dozens of helicopters.

Iran says it has started a new round of talks with the European planemaker Airbus over the purchase of dozens of helicopters.

Iran’s media quoted Asghar Fakhrieh-Kashan, a deputy minister of roads and urban development, as saying that the order comprised 48 helicopters.

“The Health Ministry is planning to order 45 HEMS (Helicopter Emergency Medical Service) helicopters and the purchase is being negotiated by the Ministry of Roads and Urban Development,” Iran’s Financial Tribune daily quoted Fakhrieh-Kashan as saying.

“Ports and Maritime Organization is also planning to hold a tender to purchase three search-and-rescue helicopters,” he was quoted as saying in a report that was also carried by Reuters.

Iran has signed deals to purchase above 200 planes since international sanctions against the country were lifted last year.

Flag-carrier Iran Air has ordered 100 planes from Airbus, 80 from US rival Boeing and 20 ATR turboprops.

In June, Airbus said two other Iranian airlines had committed to buying 73 planes in a last-minute flurry of deals for the aircraft manufacturer at the Paris Airshow, Reuters added.

Fakhrieh-Kashan further emphasized that Iran was holding negotiations to merge the helicopter order into the Iran Air-Airbus contract signed in December.

In February 2016, Iran’s media quoted the head of the country’s top medical emergency service as saying that the Islamic Republic was interested in purchasing helicopters from Airbus.

Amir-Hossein Ziayi, the head of the Red Crescent – the country’s equivalent to the Red Cross – said the Health Ministry was planning to purchase as much as 50 copters from the European planemaker.

panese Foreign Minister Taro Kono said on Thursday that his country’s policy regarding Iran is still to advance all-out ties with Tehran.

In a meeting with Deputy Foreign Minister for Legal and International Affairs Seyyed Abbas Araqchi, he congratulated President Rouhani’s reelection for another four-year term in office, hoping that bilateral relations, especially in the economic domain, would improve in post-JCPOA era.

Referring to the implementation of agreement on encouraging investment in both countries, grounds for making optimal use of existing capacities will be paved once cooperation documents are finalized.

Throwing his support behind the nuclear deal officially known as Joint Comprehensive Plan of Action (JCPOA), the Japanese minister hoped that a successful example of economic cooperation will take shape between the two countries.

Expressing willingness to visit Tehran in opportune time to reciprocate his counterpart Mohammad Javad Zarif’s last December visit, he said that deepening ties with Iran and keeping on consultations on regional developments are among Japan’s priorities.

Araqchi, for his part, congratulated Kono’s appointment as foreign minister, saying that it is pleasing to see Japan is determined to boost bilateral ties, particularly in economic sphere.

Noting that the nuclear deal has paved the way for promoting relations and using the two countries’ potentials, he said that today, conditions are prepared for pushing forward economic cooperation more than before.

He also hoped that Japanese companies will utilize economic opportunities that have emerged after the implementation of the nuclear deal in Iran.

Minister of Economy, Trade and Industry of Japan Hiroshige Sekō said Japan has put on the agenda promoting economic development with Iran.

Sekō made the remarks Wednesday in a meeting with Deputy Foreign Minister for Legal and International Affairs Abbas Araqchi.

During the meeting, he expressed congratulation over President Hassan Rouhani’s re-election as Iran president.

Japanese minister pointed to the nuclear talks between Iran and G5+1 (the US, Russia, France, Britain and China plus Germany) as important, saying Japan supports implementation of Iran deal also known as Joint Comprehensive Plan of Action (JCPOA).

Meanwhile, Araqchi said grounds have been paved for both countries to increase bilateral cooperation in post-JCPOA era.

Iran deal is being supported by international community and the United Nations Security Council and European Union called for complete implementation of JCPOA.

Sekō also invited Iran to attend 2025 Osaka World Exposition.

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