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Tarabaran; Iranian Economic & Transportation Magazine
By: Afsaneh Mohsen Nejad
Jan. 2000, No. 10
Summary: Planning in Iran dates back to 50 years ago. The first development plan was launched in 1948 and until the victory of the Islamic Revolution in 1979 five other plans were enforced.
The first post-revolution five year plan was launched in 1989, followed by the second plan in 1995 with the latter failing to produce desired results. One of the reasons for the failure of the second plan was conspicuous contradiction between the target and performance of the plan, lack of belief in planning on the part of policy makers, inattention to limitations and ambiguity in the role of representatives and apparatuses.
Text: It is said that planning for development is an academic field of science which in Iran is discussed more than other branches of economy. The idealistic thirst of the intellectuals, economists, college students and other groups involved in social affairs has given a special place to development and its planning.
Once in a few years, fervor for compilation and approval of a comprehensive plan grips the Iranian society, making assessment of the performance of the previous plan a far reaching move.
Such conception does not usually exist in other countries of the world and the issue of planning is settled by teams of experts or in academic circles. The welcome accorded to the issue particularly by those growing fond of it recently make it necessary to define planning and to give its background in Iran.
Planning has a fifty year long background in Iran and though it seems to be in the middle of its way, the country is actually learning how to take proper steps in this regard.
The development plan is a document in which favorable economic and social conditions within the framework of anticipated limitations and resources have been drawn up and suitable policies have been adopted.
However, attention should be paid to this fact that drawing up the targets and policies in the plan documents will not necessarily lead to the realization of the goals and objectives of the plan and even there might be a long distance between the performance of the economic and social development plans and its forecast targets as was evident in the first and second development plans in Iran.
Planning has a fifty year long background in Iran. The first economic development plan was launched din 1948 and five other development plans were enforced in the country until the victory of the Islamic Revolution in 1979. After the triumph of the revolution, the first economic, cultural and social development plan was launched after being approved by the Iranian parliament (Majlis) in 1989. At first, The implementation of the plan which dealt with national development projects, proceeded at a rapid pace but later it slowed down. The average period for implementation the first plan projects was estimated at seven years which in practice lasted for 10 years.
The second development plan was launched after receiving approval from the fourth Majlis in 1995. In the course of the plan except in 1995, the percentage of targets achievement stood at 60 percent annually, with half of the development projects being behind schedule. Moreover, the total credits needed for implementation of the second plan had been estimated at 101,871 billion rials, but in the first three years of the plan, 46.2 percent of the predicted budget or 47,088 billion rials in the forms of annual budget was approved. In the first half of 1997, around 42 percent of the approved budget was paid with which 20.7 percent of the annual targets of the development plan was materialized.
Some 60.7 percent of the 2,847 projects inspected in 1997 were behind schedule. Statistics and figures available show that we have got away from our predicted targets in the course of the first and second development plans and that we have attained none of the targets as planned.
The third development plan is different in nature and in terms of quality from the previous two plans. Although figures on incomes have been predicted in an optimistic manner, we see what figures can be attained in practice.
In the third development plan, the value of imports has been estimated at 112.3 billion dollars which is six billion dollars higher than the second plan. Export of non-oil commodities in the course of the third plan has been estimated at 34.3 billion dollars which indicates an increase of 7.5 billion dollars compared to that of the second plan. The number of employment opportunities was put at 310,000 at best in the second plan while the figure is to rise to 740,000 in the third plan.
Assuming that favorable social and economic conditions in the country are correctly reflected by the goals of the third plan, the reason for the contradiction between the target indexes and performance of the plan can be attributed to four groups of factors:
As the assessment of the performance of the first and second development plans shows, attainment of the targets of the development plan depends on harmony between the targets and policies of the plan, correct recognition of the effects of variables out of the control of the country's social and economic administration, and precise evaluation of technological and resources limitations and of obligations made by previous policies. Furthermore, an efficient executive apparatus as well as harmonious legal organs should exist to ensure the success of the development plan.
In recent decades, the meaning of planning has been equated with allocation of budgets for five year plans or competitions among various sectors to get a larger share of resources and as a result, each development plan has turned into an ocean of figures and numbers, making it difficult or even impossible to keep all its elements in harmony.