Parity rates for foreign currencies will remain unchanged in the budget law for the next Iranian year (March 2008-09 fiscal year), announced economy minister.
Davoud Danesh-Jafari added that the value of the national currency against the US dollar will be between 8,950 and 8,900 rials, IRIB reported Wednesday.
Useful studies have been conducted to strengthen the value of the rial against foreign currencies, he stated, adding, “The government has not taken decision on this.“
The Majlis Research Center is currently studying a proposal to strengthen the national currency against the greenback.
The proposal which was initially brought up in the Money and Credit Council is aimed at fighting inflation which was above 17 percent during the 12 months to December 21.
The initiative proposes raising the rial’s value against the US dollar to 7,000 rials from the current central bank rate of less than 9,400 rials.
Meanwhile, exporters believe that ratification of such proposal is unlikely. “It is unreasonable to reduce the value of dollar against rial to rein in the double-digit inflation,“ Hossein Salimi, a member of Iran Chamber of Commerce, Industry and Mine (ICCIM) said.
Strengthening of the rial would reduce the cost of importing raw materials but it would have adverse impact on export.
“The move would certainly benefit imports and have some influence on inflation but by it would also lead to destruction of domestic industries and worsen unemployment by making exports cheaper.“
Danesh-Jafari also confirmed that exporters favor higher value of dollar against the rial which is more profitable for them.
However any decision should benefit the national economy, the minister observed.
“When a country seeks stability in rate of foreign currencies, it means to have a balance rate taking into account the inflation at home and in the world.“
He explained that if global inflation rate stands at five percent and domestic one at 15 percent, this means nominal rate of foreign exchanges should increase by 10 percent.
“While at present and in recent years as well, value of dollar has risen less than 10 percent and euro between one and two percent.“
Moves have been taken in recent years to strengthen rial against other currencies but this should be based on ’real’, not ’nominal’, value of rial, he concluded.

Iran is prepared to supply gas to the EU’s flagship Nabucco gas pipeline, which is aimed at reducing the bloc’s reliance on Russia, Foreign Minister Manouchehr Mottaki said in Sofia, Bulgaria Tuesday.
“The EU has already pointed out the need to diversify gas supplies. One of the areas in which Iran can cooperate with Europe in the energy sector is Nabucco,“ Mottaki said in Sofia.
“Russia is the world’s largest gas supplier, followed by Iran. Both countries seek bigger markets. What choice Europe will make depends on Europe itself,“ he added, according to AFP.
The European Union is planning to build the 3,300-kilometer, five-billion-euro Nabucco pipeline to transport gas from the Middle East and Central Asia to its energy-hungry consumers in Europe while bypassing Russia.
Nabucco is the key to EU efforts to diversify gas supplies away from Russia after a political dispute between Moscow and Kiev cut exports in 2006. Russia supplies a quarter of the EU’s gas.
Critics note however that if the Nabucco project is to be profitable it will definitely need gas from Iran, which holds the world’s second largest reserves.
Meanwhile, Majlis Speaker Gholamali Haddad-Adel has also said Iran is interested in supplying gas to the European Union.
In a meeting with Bulgarian Parliament Foreign Policy Committee Chairman Solomon Passi in Tehran on Tuesday, Haddad-Adel said, “Iran is determined to implement the project of transferring gas to Europe.“
He also called for the expansion of comprehensive ties with Bulgaria.

Electricity consumption in peak hours has reached 1,200 megawatts per hour in Tehran.

Power Generation, Transmission and Distribution Company (TAVANIR) has urged businesses to conserve electricity as energy consumption has shot up sharply over the past three weeks due to unprecedented drop in temperatures.
The rise in domestic consumption coupled with a halt in Turkmenistan exports of 23 million cubic meters of gas per day led to disruptions at home.
This made Oil Ministry to divert gas quota of industrial units, power plants and factories to household use. As a result, industrial units and power plants had to use alternative fuels such as diesel and mazut to operate.
Notwithstanding all these problems, power plants continued operations and the nation did not face power disruptions.
However this week, power outages were reported in various districts of Tehran which officials blamed on fuel shortage.
Electricity consumption in peak hours has currently reached 1,200 megawatts per hour in Tehran, up four percent compared with the figures for the same period last year.
In a notification by TAVANIR on Wednesday and sent to Iran Daily via a fax, the organization has called on commercial units, shops and malls to use energy-efficient rather than incandescent light bulbs to conserve electric power.
As freezing wintry weather and rise in energy consumption for heating persist in the country, the organization appealed to trade units and businesses to turn off unnecessary power-sipping bulbs.
Owners of shops and malls have been warned not to keep lights on at nights when they are closed. Over 90 percent of country’s electricity demand is currently supplied by thermal power plants.
Meanwhile, Energy Minister Parviz Fattah confirmed that there are sporadic power outages in the country due to fuel problems facing power plants.
On the sidelines of the cabinet session, the minister stated that power in some regions is turned off from 1 a.m. to 5 a.m. to save gas and electricity for households in northern provinces.

Iran Khodro Auto Manufacturing Company will deliver its first hybrid bus in the year to March 2009, announced the company’s managing director, Manouchehr Manteqi.
Speaking in a ceremony to inaugurate the production line for vehicles which are using gas as the basic fuel, he said. Manufacturing these automobiles signifies that Iran Khodro is beginning to make use of advanced technology, ISNA reported.
He noted that $466 million worth of sedan and commercial cars, spare parts and rail transportation parts were exported in the year to March 2008.
Manteqi said that Iran Khodro aims to contribute to about 5-6 percent of the gross domestic product in the coming years, adding the company is able to become the forerunner of advanced technology in the country.
The giant auto manufacturer has used its own financial resources to achieve this, he said, adding the move put a lot financial pressure on the company.
He said that Iran Khodro, with more than 40 years of experience, manufactured only a limited number of auto spare parts and transferred technological know-how in the first 25 years of operation, noting the major part of its development took place in the past 15 years.
Meanwhile, deputy head of Iran Khodro Power Train Company (IPCO) for engineering affairs described the specifications of the auto engines which are running on gas at its main source of power. He stated that optimization of fuel consumption is among the main characteristics of the national engine.
Pedram Eslaminejad said that the engines can be installed on class B, C and D vehicles. He noted that 12 percent of the vehicles which are equipped with national engine will be exported.
“When operating on gasoline, fuel consumption of vehicles dropped by 23 to 30 percent and this is one of the main achievements of the national engine manufacturing projects,“ he noted.

New taxis will be given to private drivers who own cars 15 years old and above.

About 34,500 taxis have joined the public transportation fleet since last March and 114,000 more will be added by the end of the current Iranian year (March 19).
Announcing this, director of Note 13 Taskforce, said that a total of 150,000 taxis would be added to the transportation fleet and unlicensed cabs would be taken out of service by March 19, Persian daily ’Iran’ wrote.
Mehdi Hashemi explained that private drivers with under-five-year-old vehicles would have their cars marked (as taxis) and be given cab plate numbers.
Also private drivers whose cars are 5-15 years old should sell their vehicles and receive a taxi, taking advantage of loans earmarked for the purpose, he elaborated.
The official continued that new taxis would be given to private drivers who own cars above 15 years old. Private car drivers will be recruited by taxi companies and cooperatives, he underlined.
Hashemi disclosed that smart cards for gasoline have been delivered to 250,000 private car drivers, adding the cards were not issued for ineligible drivers.
Turning to problems faced by dual-fuel taxis and buses due to a drop in gas pressure following recent unprecedented cold weather, he said that the taskforce has proposed to the Cabinet to increase the quota for bi-fuel cars which could not get their quota due to disruptions in gas supplies.
He hoped that the proposal would be approved by next week.
On monorail line, he explained that monorail is considered as one of the essentials of public transportation fleet.
Preliminary plan has been approved for Tehran, he said, calling for acceleration in monorail project for Tehran and other metropolises.
The official recalled that converting bakeries, medical centers and industrial units to dual-fuel systems had been on the agenda of government. After the recent cold snap, more attention was given to the initiative, he added.
The main objective of Note 13 is to overhaul the public transportation network rather than reduce gasoline consumption and enforce rationing, etc.
The note mandates the government to renovate and develop public transport and phase-out dilapidated cars.
Reform in transportation industry is a daunting task. Overhaul in this vital sector is linked to reform in many sectors of which gasoline rationing and regulating the market is a small part.

Head of Iran Shrimp Guild Association said that about 1,500 tons of shrimp are ready for export in the current Iranian year to March 21.
Speaking to MNA, Akbar Saeedi Tehranband noted that although the ban on shrimp export to the European Union has been lifted, export of this seafood has not resumed yet and 1,500 tons of shrimps are stockpiled in cold storage.
Agricultural Jihad Minister Mohammad Reza Eskandari announced last month that problems pertaining to shrimp exports to EU were removed after five years.
He elaborated that following the European ban on shrimp imports from Iran five years ago, a special committee was set up by the ministries of agricultural jihad and foreign affairs and monitoring plans were presented to the European Union Food Safety Commission. The European Union stopped importing shrimp from Iran on the pretext that Iran’s State Veterinary Organization did not submit required documents on time.
Tehranband pointed out that January is the best time for shrimp export but ’we lost time and did not negotiate with former customers’. He added that finding new customers will take time. Shrimp export to EU was to resume in January.
About 15 percent of subsidies allocated to shrimp industry during the year to March 2006 was not distributed among shrimp farmers, the official said, adding that shrimp export is subsidy-dependent and the government should pay 6,000 rials per kilo in subsidy whereas it paid 900 rials for each kilo of shrimp.
Iran has approximately 2,600 hectares of shrimp ponds, but that number will probably drop to 1,600 in 2008 due to storms in the south that inflicted heavy damage on shrimp farms.