Video- Islamic Iran to launch second phase of subsidy reform plan soon

Over a year since the launch of the subsidy reform plan back in December 2010, the Iranian government says the second phase will be implemented in the near future. The plan is aimed at overhauling the country’s economy by shelving energy and food subsidies.
Under the Targeted Subsidy Law the revenues generated by price increases are distributed both among people and productive enterprises. The subsidy reform plan allowed the Iranian government to gradually slash subsidies on fuel, electricity, and certain goods over the course of five years, with low-income families being compensated with direct cash handouts.
But the plan has drawn different reactions from the people.
When the law was passed by the parliament, half of the additional revenue was earmarked for individuals and families in the form of cash subsidies, while 30 percent was initially to go to industrial and agricultural enterprises. The figure was later reduced to 20%.
Davoud Soheili, is an Iranian producer, who says that in the past one year no financial or facility support has been offered to manufacturers. According to the Iranian deputy minister of economic affairs and finance Mohammad Reza Farzin, the policies and plans of the government in the second phase aim to contain inflation and support the production sector.

The second phase of implementing the Subsidy Reform Plan has envisaged removing subsidies of some three million Iranian families. The Iranian government is planning to pay more cash subsidies to the economically vulnerable strata and cut subsidies of the well-off families.