EghtesadOnline: The Central Bank of Iran, as part of a plan called "Productive Working Capital" has assigned a number of banks to lend 1,000 trillion rials ($8.3 billion) to productive businesses in the agriculture, housing and construction, industries and mining, petroleum and tourism sectors.
As per a press release published on the CBI website on Tuesday, nearly half of the amount is set to be paid to companies in the industrial and mining sectors. Businesses in agriculture are set to receive 200 trillion rials ($1.6 billion). The same amount will be paid to housing and construction projects.
Business plans capable of moving tourism industry forward are set to receive 60 trillion rials ($500 million). Petroleum projects will be eligible for 40 trillion rials ($333 million).
The Ministry of Roads and Urban Development, Ministry of Agriculture, Ministry of Cultural Heritage, Handicrafts and Tourism, Ministry of Industries, Mining and Trade are responsible for introducing eligible companies to the banks, Financial Tribune reported.
In September, CBI Governor Abdolnasser Hemmati said the CBI was working on a plan to let lenders procure funds to lend to manufactures in an optimal manner, ensuring that the loans would be used only for boosting production and rein back inflation.
According to Hemmati, any plan to fund the manufactures’ need for working capital should “in the first place ensure that the money would be used only for this purpose. Second, it should be given only to production firms. Should this not be the case, the result would be more inflation and more price shocks”
The Money and Credit Council approved an outline of a plan last week to streamline policies and procedures again for funding manufacturing units.
According to a report on corporate loans, banks and credit institutions paid 3, 382 trillion rials ($29 billion) during the first six months of the current fiscal year (March 20-Sept. 22), out of which 2,111.7 trillion rials ($18 billion) was given to help recapitalize manufactures.
Representing more than 55% of the total loans in H1, the figure indicates a year-on-year hike of 13.5%, with the mining and industrial sector topping the list at 40.8%.