Iran to Launch E-Subsidy System in November, Pledging Price Stability for Essential Goods
In a significant move to support household economies, Iran is set to implement a new electronic ration card (e-ration card) system starting in November, with government officials assuring citizens that prices for essential goods will remain stable.
A Shield Against Inflation
Ahmad Anarki Mohammadi, a member of the Iranian Parliament’s Economic Commission, directly addressed public concerns about potential price hikes. He emphasized that the core purpose of the e-ration card is to provide targeted support for lower-income and vulnerable families, thereby insulating these essential items from inflation.
“The expectation in society, given the current situation, is for prices to rise,” Mohammadi stated. “However, the ration card has a specific definition and is given to weaker and less well-off families. As a result, inflation cannot be applied to those goods.”
Cross-Government Consensus for Swift Implementation
The official confirmed that the rollout of the system is a top priority, backed by a consensus across different branches of the Iranian government. “What the government has in mind, and with the parliament’s assistance, the decision made in a meeting of the heads of the branches of government to expedite it, is that the ration card will be implemented from the beginning of [the month of] Aban (November), and prices will remain fixed,” he explained.
Subsidized Currency as the Foundation
The economic stability of the new program is rooted in the use of subsidized currency for essential imports. Mohammadi clarified that the goods currently in the supply chain or in storage were purchased at the official rate of 28,500 tomans. He expressed confidence that this would prevent price increases upon the system’s launch.
Acknowledging the gap between the official and open market exchange rates, the parliamentarian suggested the government would absorb the financial difference. “Regarding the exchange rate difference we have, I believe the government will help the people and pay this amount so that inflation does not significantly affect essential goods,” he said.
Direct Support to the People
Mohammadi highlighted the efficiency of providing direct financial support to citizens, comparing it to existing subsidies for bread. He noted that while the mechanism is complex, direct payments prevent profiteering within the supply chain.
“Unfortunately, when a commodity purchased at 28,500 tomans is equivalent to one valued at 60,000 to 70,000 tomans, there are rent-seeking activities in the middle that must be eliminated,” he said. “The money should reach the people themselves… This is the best action that can be taken.”
Initial Basket and Future Adjustments
The initial basket of essential goods under the e-ration card system will contain 13 items, as identified by the Ministry of Agriculture. Mohammadi indicated that this basket, comprising goods deemed necessary for the public, is subject to future review and adjustment based on the evolving needs of the people and society.