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Iran: Public-Transport Bill Offers Window On Political Divide

With Iranians limited in the amount of gas they can buy, the black market has thrived (AFP) October 23, 2007 (RFE/RL) -- Iran's parliament recently approved the outlines of a government bill to expand public transportation as part of a continuing official bid to curb the use of cars and reduce costly fuel imports.

But the approval of the bill's framework on October 16 was far from overwhelming, with 108 of the 209 lawmakers present voting for its passage, "Etemad-i Melli" reported on October 17. That split appears to highlight the divide between the government and detractors who argue that gasoline rationing has been badly bungled and fear the government's implementation of the new proposal will be no better.

The framework bill to expand public transport and manage fuel use, as it's called, must still be approved by the powerful Guardians Council, a body of jurists with broad authority to vet legislation. But the framework's relatively narrow passage also signals potential obstacles when the detailed legislation eventually comes back before lawmakers.

The plan would commit the government to expand railways and public transportation, take ageing cars off the road, and convert gasoline-powered cars to dual-use vehicles that can run on gasoline and liquefied gas (LPG). It also calls for improved highways, more stations to sell liquefied gas, the manufacture of cars that run on LPG and support for the production of hybrid and electric cars, and greater fuel efficiency in general, "Etemad-i Melli" reported.

The framework bill urges the government to help create conditions that will dramatically reduce the flow of private vehicles on city streets. It advocates a goal of making buses and other public transport responsible for 75 percent of all city traffic.

The draft earmarks about $10.7 billion (10 trillion tumans) per year for its implementation. Reformist legislator Hadi Haqshenas told his parliamentary colleagues that the expenditure could represent half the entire state construction and development budget for the next fiscal year from March 2008, the financial daily "Donya-i Eqtesad" reported on October 17.

A Lack Of Focus

Some legislators warned of potential problems accompanying the draft bill and the limitations of legislative initiatives with such broad goals as "expanding public transportation and limiting fuel use across Iran." Minab representative Ali Moallemipur argued that the bill would channel funds to large cities at the expense of smaller constituencies, compounding problems in rural districts. Moallemipur claimed such districts are already facing fuel shortages under the current restrictions, in place since June.

A legislator from Lahijan, Iraj Nadimi, chided the government over the absence of a comprehensive policy on fuel use and transportation -- and stressed that specific plans in that area must be "focused," "Etemad-i Melli" reported.

The bill was defended in parliament by Iran's interior and transportation ministers. Transportation Minister Mohammad Rahmati said public transportation is presently "very weak" in cities and between cities, adding that the country needs 10 years to strengthen its transportation infrastructure. Interior Minister Mostafa Purmohammadi said the framework is in line with the current five-year (2005-10) development plan and the "20-year perspective," which sets out Iran's midterm development goals. Purmohammadi sought to deflect criticism at this stage by saying parliamentarians' queries can be addressed once the bill is debated in all its details.

'Problems Of Implementation'

The public-transportation framework is part of ongoing efforts to curb fuel use and costly gasoline imports. But in barely disguised rebukes of the government, some lawmakers have observed -- particularly in recent months -- that legislation is helpful only when it is implemented correctly.

Members of parliament have repeatedly criticized President Mahmud Ahmadinejad's government for failing to fully implement the current law restricting fuel use -- known as Addendum 13 (to the budget for the year to March 2008). That legislation allows Iranian drivers a monthly quota of 100 liters of gasoline at a heavily subsidized price (100 tumans, or roughly $0.11) while allowing further purchases at a higher price. But authorities still have not announced the higher price, essentially blocking any legal sales of gasoline beyond subsidized levels. The situation has reportedly fueled a bustling black market for gasoline, and some observers claim that traffic has crept back to prerestriction levels -- at least in the capital, Tehran.

Amid debate over the new framework bill, detractors argued on October 16 that the new public-transportation bill has nothing that is not already in Addendum 13 to curb fuel usage, "Donya-i Eqtesad" reported. Minab legislator Moallemipur said the problem is not a lack of legislation but rather a "problem of implementation." He said Addendum 13, as implemented by the government, has led to fuel shortages and inflation -- something the government promised would not happen. Moallemipur claimed that black-market fuel is sold in Tehran for 200 tumans a liter (about $0.21) and about five times that price in the southern port city of Bandar Abbas. He called that an illustration of the government's negligent implementation of current legislation.

A Question Of Management

Meanwhile, the reformist daily "Etemad" observed on October 17 that the basic problem with fuel remains. Fuel is subsidized and thus wasted, it said, and Addendum 13 has merely sought to reduce the economic cost of subsidies by restricting gasoline use. "Etemad" observed that state development plans seek to phase out subsidies, not restrict fuel use. The paper also estimated that Iran has spent about $17 billion in the past three years on imported gasoline and gas oil, a heating fuel, which it has sold at subsidized prices to Iranians.

A Shirvan representative and member of the parliamentary Energy Committee, Hossein Afarideh, has painted a similar picture of natural-gas waste. Afarideh said a cubic meter of gas costs about $1.30 in Iraq, $1.10 in the United Arab Emirates, $0.70 in Saudi Arabia -- and $0.08 in Iran. He said Iran is not exporting gas because it cannot manage consumption at home and has no "comprehensive energy plan." Afarideh said this national asset is being "burned away" and, with current consumption levels, "all the gas in the world" might not be enough to meet Iranians' demand. He claimed that "the wealth that [might otherwise] be used to create jobs has been destroyed [due to a] lack of management."

The buzzwords among Iranian parliamentarians and officials are "energy use" and fuel "management" -- notions that are being interpreted differently depending on people's economic ideas. Some Iranian politicians appear to think the market should be given a greater regulatory role -- like a seemingly thriving black market in gasoline. Others, including members of the Ahmadinejad government, seem to think that consumption can be curbed from above -- with an emphasis on reduced consumption rather than price liberalization, which they fear could fuel already persistent inflation. The framework bill appears to highlight the government's determination to force Iranians to reduce waste while it maintains a hand in their social and economic affairs.

RFE/RL Iran Report

RFE/RL Iran Report

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