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29-04-2026
TEHRAN: Across Iran’s capital, life has returned to a kind of normal.
Markets, cafes and shops are opening their doors, and some highways are buzzing with traffic once again as a fragile ceasefire with the United States largely holds after weeks of devastating US-Israeli attacks.
Yet customers are cautious.
“Standing in a shop, most things are still available, but a lot of times now, it’s a question of whether you want something or need it,” said a young resident of western Tehran who asked not to be named.
“Many people are resorting to buying just the basics now.”
As worries about the future rise and purchasing habits change, the government is moving to ensure the availability of food and medicines in an effort to ease the mounting pressure the war is placing on the Iranian people.
On Sunday, the cabinet added a clause to implementation guidelines for the annual budget to restart a preferential exchange rate for imports of essentials like wheat, medicines, medical equipment and baby formula.
This means the government plans to give up to $3.5bn from its share of oil and gas proceeds to a network of trustees to import essential goods. These imports will be bought at an official exchange rate of 285,000 rials per US dollar – much lower than the open-market rate of 1.55 million rials per dollar, and also below the budget rate of 1.23 million rials, according to state media.
The move signals a partial policy reversal for the government from the budget it proposed in late December, when demonstrations by shopkeepers in Tehran that developed into nationwide antigovernment protests.
That budget sought to eliminate the cheapest currency rate. The rationale at the time was that the subsidized rate virtually created a nontransparent system that for years propagated corruption without meaningfully reducing prices for average Iranians but on Sunday, a deputy at the Ministry of Cooperatives, Labour and Social Welfare told state television that the price of essential goods has been “significantly affected” by the elimination of the cheap currency rate.
Yaghoub Andayesh said the ministry has presented different scenarios to the government to “guarantee food security” across 11 categories of essential goods that have experienced huge price increases over recent months but refused to provide exact figures for the price hikes.
In addition to reintroducing the cheap exchange rate, the official said the government is evaluating if it can increase the volume of monthly handouts and electronic coupons to Iranians to partially compensate for one of the highest food inflation rates in the world. Each person is currently eligible for the equivalent of less than $10 per month.
Drawing from sovereign fund
Iranian authorities are also tapping into the sanctions-hit country’s sovereign wealth fund to buy essential goods, the latest such move in recent years.
State media reported on Sunday that up to $1bn is to be taken out of the National Development Fund of Iran to procure imported sugar, rice, barley, corn, soya bean meal, red meat and chicken meat “with the aim of complementing strategic reserves”.
Authorities have maintained the country has sufficient currency and gold reserves and redirected some oil sales conducted in circumvention of US sanctions to the fund, but they provided no detailed information.
On Sunday, state television said despite the US blockade on Iran’s ports and bombing of its oil and gas facilities, the country’s main challenge is not trying to ramp up production or to get supertankers out of the Strait of Hormuz. (Int’l News Desk)
