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Friday, October 22, 2021

Investment Capacity in Prioritized Sectors

Transportation and Urban Development

In Tehran province has a total of 2,936 kilometers of main road, including 198 kilometers of freeway, 456 kilometers of highways, 194 kilometers of main roads and 119 kilometers of side roads. In rural areas of the province, there are 1,925 kilometers of road, including 1,570 kilometers of asphalt and 355 kilometers of dirt and non-tarmac road.

Activities carried out in Tehran’s transportation sector include elimination of accident-prone roads, use of modern road safety elements, communication signs and equipment, creating desirable condition on highways and tunnels in terms of lighting, proper coverage of provincial roads in terms of number of traffic signs, appropriateness of toll-houses in the province, creation of 33 provincial intercity services and welfare complexes, roadside school safety, suitable intercity gas stations, intercity police stations, higher number of emergency vehicle and medical services, coating and asphalting of most provincial roads, timely grit and salt distribution in snow prone areas of the province, monitoring of roads and connecting online information, construction of pedestrian bridges spanning all roads, continuous lining of roads, increased investment in new technologies, exploiting strategic and maintenance and repair facilities, control of passengers and cargo fleets.

The length of railroad tracks 1,035 kilometers, moving 8,159 passengers per year. Opportunities existing in the railroad sector of Tehran Province include: Creation of joint cargo and passenger areas, facilities offered by the National Development Fund for railway transport development, the establishment of more than 20% of the country’s population in areas of public transport, the existence of West Customs, Shahriar Customs as transit points and lower employment levels than in road transport.

The subway in Tehran province is 189 kilometers in length with 107 stations and 1,263 wagons on 7 lines, transporting 1,975,342 passengers daily. Taxi and bus fleets carry an average of 3,780,821 and 3,562,000 passengers daily, with 78,722 and 6,262 vehicles, respectively.

At Imam Khomeini International and Mehrabad local airports in Tehran, 202,608 flights are made annually (143,433 domestic, 59,175 international). Mahan and Turkish are at the top domestic and foreign airlines, respectively. The amount of cargo carried by the airports in the province is 207,775 thousand tons and the number of transported passengers is 26,451,349.

1,288,000 road trips were made (855,000 by bus, 12,000 by minibus and 421,000 by passenger vehicles), an average of 110,000 trips in 2017 (Yr. ended March 2018). 117,000 inter-provincial trips were recorded (4,000 by bus, 45,000 by minibus and 68,000 by passenger vehicles). A total of 1,234,000 passengers were moved, of which 740,000 passengers were from Tehran.

The province's major contribution to the movement of goods and passengers on the roads, increasing travel demands, insurance companies’ focus on road accidents, the process of construction, renovation, and development of transportation infrastructure are essential for the development of Tehran public transportation network. Increasing the scientific and technical level of the transportation industry, transferring and localizing technology, supporting manufacturers machinery and equipment are among the province's capacities in the field of transportation.

New cities of Tehran province

Increasing population in new cities requires huge investments in facility development and providing services. In addition to the large population, most of the new cities have a greater area of influence and consequently a large consumer market.

 

The New city of Andisheh

Andisheh is one of the new cities of Tehran province and one of the most successful urban development policies in Iran. The city is located in the central part of Shahriar and has six phases, located 30 km outside Tehran, 3 km Northwest of Shahriar and 7 km Southeast of Karaj. Andisheh city is designed and built according to current urban planning and civil regulations. The new triangle-shaped city of Andisheh is 1,495 hectares, located South-east of Karaj and East of Malard road. The county also has a special status in terms of convenient access to the regional transit networks. The above-mentioned land areas are surrounded in the East by Karaj River and in the West by the Alborz Province Development Plan zone, in the South by Shahriar and Malard and in the North by Haftjuy village.

The New city of Parand

Parand is a newly established urban area in Rabat Karim County of Tehran province, located 33 kilometers South-west of the capital, comprised of 7 phases along Road 65 (Tehran-Saveh Expressway). In the future, the number of Parand phases will expand to 16. Since 1994, with the aim of creating low-cost housing, numerous companies began to build large and small apartments close to villas already built or under construction. Parand is approximately 17,000 hectares, comprised of two residential areas to the North and an industrial Estate to the South. Parand Industrial estate was established on 358 hectares of land, and the most important commercial activities in the estate include automotive, electrical power and electronics, metal industries except casting and commercial services.

The goals of establishing the industrial estate are:

·         Turning the city into an industrial hub for centralized production of various automotive parts and IT services in Iran

·         Creating a suitable export zone (proximity to Imam Khomeini Airport)

·         Proximity to the newly established City of Parand for accommodation of factory staff

·         Establishment of an International Fairground in the new city of Parand

Agriculture and Complementary Industries

Of the 1,384,200 hectares of agricultural land in the province, 135,684 hectares are cultivated for agricultural crops and 46,577 hectares for orchard products.

Crop yields for rainfed and irrigated crops were recorded at 2,825,756 tons and crop yields for irrigated and rainfed crops were 2,101.5 and 945.9 kg/ha, respectively. The major crops in Tehran province are forage maize, wheat and barley. More than 2,732,760 tons (2,824,541 tons from irrigated cultivation and 1,216 tons from rainfed agriculture) were harvested from cultivated lands. The province’s share of the country’s total agricultural production is 3.4% and is the 3rd largest producer of forage maize.

The total number of production units in Tehran province is 14,759 which includes livestock, poultry, fish farming, greenhouses, mushroom cultivation, beekeeping, cold storage and complimentary industries. The total number of production and service units is 14,915, including 156 cooperatives and associations.

The province’s production of horticultural products is estimated at 1,302,000 tons and the major horticultural crops include apple, cherry and grapes. The province ranks 2nd in cherry and 3rd in apple production and in total horticultural production. The amount of mushroom and greenhouse production in Tehran province is 35000 and 524000 tons, respectively, and the province is ranked 1st in edible mushroom and greenhouse production. It has a complimentary capacity of 2,000 tons and 142,000-ton capacity in cold storage.

Livestock production in the province is more than 1,337 thousand tons. Milk accounts for 79%, eggs 12%, poultry 5% and red meat 2% of the province’s livestock production, which includes 31,000 tons of meat, 1,065 tons of milk, 69,000 tons of chicken, 165,000 tons of eggs, 9,000 tons of honey, 2.6 thousand tons of fish. The province ranks 1st in egg, 2nd in raw milk and 7th in meat production.

The active warm-water fish farms in Tehran province are 318 in number and cold-water fish farms are 126, in an area of 56,302 and 77 hectares, respectively.

According to the Agricultural Jahad statistics, the amount of export and import of agricultural products in Tehran province in 2017 (Yr. ended March 2018) were 187 and 54 tons, worth 404 and 368 million dollars respectively. The main export products are: gut, balloon and rumen, skin and wool, dairy, Pistachio and saffron, and the major imported products include butter, seeds, fertilizers, machinery, edible oils, red meat, and animal by products.

The most important agricultural areas of Tehran are Rudbar Ghasran in Northeast of Tehran, with fertile lands and numerous gardens. Lavasanat in the west of Damavand city is one of the other agricultural areas of Tehran that has fertile soil. The valleys of this area also have numerous gardens. The valleys and slopes of the Alborz Highlands with lush and rich rangelands are suitable for livestock activities. At the provincial level, livestock breeding is common both in the plains and in mountainous areas, but its share is negligible in the province’s economy.

The advantages of the province’s agricultural sector include the mitigation of the effects of drought and restitution of deficit irrigation, the processing capacities of various crops, the existence of quality control laboratories for pesticides, pest and disease detection, pest control and awareness network, establishment of four agricultural conservation sites, implementation of canola combined-nutrition management pilot projects, production of 6,200 tons of edible fish, obtaining the second rank in production of ornamental fish production, establishment of depots and live fishery centers, breeding new aquatic species, implementation of pilot aquaculture and launch of a central dock. Opportunities for this sector include climate variety, the existence of a 20% consumption market for agricultural products, implementation of water and soil remediation schemes (over 6 million hectares), proximity to the consumer market, international airport, and reduced transportation costs.

The use of modern irrigation methods, focusing the cropping pattern on less water-intensive crops, surface water regulation, selecting the right time for crop production, as well as using recycled water resources in the agricultural sector, have paved the way for foreign investors.

The province’s natural forests are commonly located in highlands and mountainous areas, with a total of 59,269 hectares of forests, including 14,974 hectares of natural forest, 13,944 hectares of forest under plantation, and 30,350 hectares of shared forest.

919,763 hectares of grazing land accounts for 67% of the province’s area, with an optimal production potential of 229,940.75 tons of fodder and includes rural summer, winter and transitional pasture grazing land.

Obtaining a national land title or deed and a certificate from the natural resources conservation Office is possible in the natural resources sector. Opportunities are also available to create appropriate foundations against flood control, cultivation and enhancement of indigenous and compatible plants under natural conditions.

Health

The growth of population, aging, prevalence of chronic diseases, and changing patterns of disease, increases the need to prioritize economic welfare development and public insurance coverage services.

In Tehran province, health and welfare services are offered by 3 universities of medical science, Tehran and Iran Health Services, as well as Tehran Blood Transfusion and Emergency Department. About 161 public and private hospitals with 23,210 beds exist in Tehran province. 88 hospitals are affiliated to the universities of medical sciences and medical services, 62 hospitals belong to the private sector. 11 charity hospitals, 239 health clinics, 276 health centers, 1,360 chief care sites, 94 emergency departments, 1,005 medical diagnostic laboratories, pharmacies, diagnostic, therapeutic, and nuclear facilities and rehabilitation centers are located in Tehran province. Moreover, 5,974 physicians and more than 23,455 paramedics work in the province’s medical sciences and health services, or universities.

Construction, equipping and operation of hospitals, comprehensive cancer centers, dialysis centers, and laboratories are potentials in the health tourism sector in Iran.

 

 

Tourism

Tehran has a relatively high share of Iran’s tourism industry in terms of both employment and GDP indices, and is the primary destination for foreign tourists, as it is considered the first point of entry. Museums, palaces, historical and cultural locations increase the importance and significance of Tehran greatly.

Tehran’s tourism GDP share is $2.7 billion, and the city has earned $2.4 billion from domestic tourist spending.

In 2017 (Ending March 2018), the share of Tehran’s tourism market was 23.2% of the total IRI tourism market and accounted for 2.5% of Tehran’s GDP. It is also projected that the size of Tehran’s tourism market will rise to $3.7 billion in 2027 (Ending March 2028).

According to the World Travel and Tourism Council (WTTC), the number of people working in tourism in the province has increased by an average of 6.8% annually over the past 10 years, with Tehran ranked 2nd in the world for tourism employment.

Due to the historical and tourist attractions, Tehran province welcomes a large number of guests and tourists from all over Iran and the world every year. About 12,537,000 tourists (8,444,000 passengers on domestic flights, 4,093,000 on international flights) arrived in the province. In addition, 16,313 tourists (7,906 on domestic flights, 8,407 on international flights) left the province.

A total of 260 residential spaces are located in the province with 24,147 beds. Accommodations in Tehran include 7 five-star hotels, 16 four-star hotels, 33 three-star hotels, 63 one and two-star hotels and 61 inns.

Tehran Province requires strict policies and planning for sustainable tourism development, leading to the economic growth in the city, a balanced and maintainable growth of the industry in the capital. This will lead to the elimination of current inadequacies and minimize the negative psychological and propaganda effects on foreign tourists. By making this a reality, the way is paved to attract more tourists to Iran and promote other tourism destinations.

Information Technology

In Tehran province, in terms of access to information and communication technology, access to land lines is 99.6%, television 99.3%, internet 51.3%, computers 58.9%, and radio 69.2%. Tehran Province has been ranked 1st on the Information and Communication Technology Development Index (IDI) with a value of 7.37 and in the last 5 years, Tehran has had the highest growth in the IDI index.

According to the ranking of top Iranian companies, about 50 companies in the field of ICT were placed in the list of 500 best-selling companies of the year.

The number of high-speed internet lines in Tehran province is 1.023,063 with 99.9% being household type and 0.05% commercial, respectively. Internet influence rate is 76%.

The landline telephone subscribers in the province were 7.3 million, of which 96.7% were in urban and 0.28% in rural areas.

Information, communication technology and software companies have the largest share of knowledge-based companies, with more than 18% of all knowledge-based companies operating in the field of information technology.

 

Start-ups in the Field of Transportation

Following the successful launch of apps and systems such as Uber worldwide, similar examples have occurred in the country such as Snap and Tapsi, which began to operate with the rise of the Internet and smartphones, welcomed by many in Tehran.

Snap is the 1st online travel service in Iran and started operating in the winter of 2015. Tapsi is the 2nd smart Iranian car application system for inter-city trips. This application was introduced to citizens of Tehran in June 2016. At the time of writing this document, in addition to the two main players in the market, Snap and Tapsi, a new actor named Carpino was created, relying on the taxi fleet. Carpino had its pilot run in March 2016 and has been operating since spring of 2017.

 

-Payment start-ups

Fintech, or the use of new technologies in establishing financial start-ups, is one of the sub-sectors that has benefited the most from the improvement of the country’s Internet infrastructure, as new services are typically offered on the mobile interface and require constant, public and inexpensive internet access.

The Fintech is an emerging industry in Iran and has turned to the banking sector for several years. Some companies have been trying to invest in Fintech for years. The highest percentage of start-ups in Iran are in the field of e-commerce and the lowest percentage in subscription financing and cloud computing. The financial and banking start-up activity accounted for 2.6% and the mobile-based services 8% of the total start-ups.

-Food Startups

The food sector has been witness to significant growth and success among the province’s industries. In recent years, especially with the development of the mobile and Internet, startups have focused on the fast food industry and delivery in Iran, each of which has offered innovation, creativity or value and increased the potential for investment in this field.

At present, the Etelaat information technology park in the industrial districts of Tehran province, with an area of 10 hectares, in a suitable geographical location, with infrastructure, associated permits, fast access to transportation and proximity to scientific centers, is one of Tehran’s special locations for foreign investors in the IT sector.

Modern Industries

Tehran province is one of the major industrial hubs in Iran. Of the 8,560 industrial units in the country, 3,295 units (38% of the total industries) are located in Tehran province. Most of these are concentrated along three western, southern and eastern roads. 44% of industrial workers in Iran work in Tehran province. The province accounts for about 20.6% of the total industrial units and 20.5% of total employment in industrial units. In 2016, the province’s share of the number of operating licenses issued, the employment resulting from the establishment licenses, and the investment resulting from operating licenses were 10.2%, 13.3% and 7.1%, respectively. Additionally, in the period 2011-2016, 50 operating licenses were issued for new and high technology units.

In 2016, Tehran province had 325,000 trade units with business permits. About 16% of production units, 14.4% of distribution units, 15.1% of Iranian service units, as well as 21% of chain stores and 52% of virtual stores also operate in Tehran province.

Opportunities for this sector include: The industry sector of Tehran province consists of about 420,000 production units, capable NGO’s in production and commercial affairs, over 50% registrations of payment orders, 40% active business and commercial licenses, export markets and chain stores (public fruit and vegetable hyper stores). An extensive banking network, international transport corridors, international airports and railroad facilities.

262 mines are located in Tehran province with 92 active mines, of which 4 mines are State owned and 88 belong to the private sector. 42 Shingle and gravel mines, 17 limestone and 11 ballast are active, the highest number of mines managed by the private sector. 91 mines are excavated using the open method and 1 using the underground method.

Tehran Province with 92 active mines is the 3rd largest producer of minerals, accounting for 15.4% of the country’s total mines. Ore deposits are found in the following categories: copper, lead, manganese and iron. Almost all of Iran’s manganese is extracted from manganese mines in Tehran province, located in the South and Southwest. Non-metallic mines contain limestone and dolomite deposits. Refractory soil mines include kaolin, which accounts for 51% of the country’s total production. The province’s gypsum mines also have large reserves; nitonite and industrial soil mines have been discovered in the Eastern and South-eastern parts of the province.

In 2016, the definitive reserves (explored mines) of the mines in Tehran province was estimated at 27 million tons and the nominal mining total was 49 million tons. Operating licenses were issued for 25 mines and the employment in the province’s mines was 3,774. During the 5th Development Plan period, the ratio of mineral export to exploration licenses, employment licenses, licenses issued and actual production tonnage increased by 283%, 25.5% and 28%, respectively.

The mines also contain non-metallic minerals and mining materials, turning the area into the hub of building materials, large cement factories, sand grading, and concrete and ceramic tiles. The opportunities in this sector include reassignment options, exclusive minerals such as phosphates, Gravel mines in Southern Tehran, thanks to new alluvial sources, metallic mineral indexes such as manganese and copper and rich resources of tile and ceramic materials.

The Ministry of Industry, Mining and Commerce is permitted to issue licenses to establish modern industries, biotechnology, or nanotechnology industries in Tehran province within a 120-kilometer range and inside industrial parks. Such industries include:

- Electronic (Integrated Circuits, Simple, Advanced Electronic and Communication Equipment)

- Manufacturing of new materials (formulation or packaging of composites used solely for medical and defence purposes and the production of superconductors and biotech chips).

- Laser & Optics (Lenses, Laser Equipment, Optical Fiber, Crystals and Optical Thin Layers, Optomechanics)

- Advanced intelligent process control equipment (precision instrumentation, heat control, sensors, robotics)

- Aerospace (manufacture of air navigation equipment, flight control systems, manufacture of aircraft control equipment including lighter-than-air equipment such as balloons, airborne aircraft and helicopters)

- New software technologies related to the satellite industry in Tehran


A large number of industrial projects have been established with the participation of the private sector, but some projects are semi-active and inactive, requiring capital investment. Some of these projects have high investment potential thanks to proper development, obtaining the necessary permits and suitable location. An attractive investment option is development participation in such projects.

 

New Energies

Considering the limitations of fossil fuel sources and their harmfulness and the environment, the study and use of renewable energies as alternative energy resources is of particular importance, of which solar energy is very significant, given that the energy is completely clean and pollution-free.

The average annual solar radiation intensity in Tehran is 58.4 kWh/m2 daily, therefore, using solar energy as an alternative energy, not only reduces fossil fuel consumption, but expands the culture of clean energy use without environmental hazards and pollution.

Energy parks have been established in different areas of Tehran city. Energy parks are thematic parks that offer training ideas and tools on various types of new energy applications, especially solar energy, providing a culture for using clean energy to replace fossil fuels. The most important measures taken in such parks include establishment of solar power plants, small-scale wind turbines, solar water heaters, stove and solar boxwood cutters.

In terms of investing in renewable energies in Tehran province, suitable facilities and incentives are provided for investors, including guaranteed obtainment of renewable electricity, free electricity usage regulation and obligation to deliver liquid fuel to user regulation.

Capital and Financial Market

The Tehran Stock Exchange was established in 1967 and has continued its activities in 4 phases (1967-1978), (1979-1988), (1999-2004) and (since 2005). The aim of the Tehran Stock Exchange is to become the region’s leading stock exchange and the engine for economic growth. One of the goals of this stock exchange is to attract foreign capital and make effective use of the benefits of membership in international institutions and to cooperate for foreign stocks. Thus, a regulation is in force for foreign investors specifically. Stocks, debt securities, derivative securities and funds are some of the products of this market.

Today, providing liquidity is one of the main problems facing enterprises in the country. The Iranian financial market is predominantly bank-based, and banks provide financial resources in Iran. The current volume of issuance of securities in the capital market and the special attention of the legislator to the budget as well as the financing of the government with the issuance of securities, indicates the centrality of the capital market in financing the various economic sectors. The diversity and development of financial instruments and institutions has also increased the number of shareholders and investors in the capital market and created new structures. Investment funds are one of the types of financial intermediaries and are regarded as the capital of institutions that require funds. Funds are obtained through the continued sale of investment units to the public and spending of received assets in a variety of securities including stocks, Islamic securities, short-term money market instruments and other assets.

Value of Transactions and Indices

In early 2019, the total index of Tehran Stock Exchange was 33,575,652 trades, at the value of 1,606,140 billion Rials in the stock market, debt market, derived market and investment funds which reached the value of 178.659.

According to the Financial Intelligence Processing Center report, the 10 largest investment funds involved in the Tehran Stock Exchange are listed below, net asset, (early 2019).

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