In conjunction with the ratification of Iranian regime President Masoud Pezeshkian’s budget proposal in parliament, the spokesperson for the government announced that the country’s military budget would see a 200 percent increase. She stated, “Every effort has been made to address the country’s defense needs, with special attention given to this matter; consequently, the military budget will experience a 200 percent increase.” This increase effectively triples the military budget of the clerical regime.
Economist Ahmad Alavi views the 2025 budget as rooted in rent distribution among the nation’s political and economic players. One defining feature of Iran’s economy is the divide between inclusive organizations, which promote economic growth and development, and extractive institutions, which function to capture rents and serve the interests of a small elite, the oligarchy that holds power.
A significant portion of the budget is allocated to institutions controlled by oligarchs, power factions, and groups close to the regime. These institutions include large foundations and economic enterprises such as the “Execution of Imam Khomeini’s Order” foundation, and Astan Quds Razavi, which are tax-exempt or evade taxes and operate under the direct supervision of the regime Supreme Leader Ali Khamenei. These entities benefit from state funds, part of which they direct towards commercial, political, and religious activities without significant economic returns for society. Additionally, substantial budget allocations go to military and security entities like the Islamic Revolutionary Guard Corps (IRGC), IRGC Basij forces, and affiliated propaganda, religious, and quasi-political organizations. Such allocations align with the theory of extractive institutions, where resources are used not for infrastructure or production, but to strengthen political control and influence.
A Quarter of the Budget Directed Toward Military and Suppression Forces
Research by Iran Open Data Center shows that this year, the direct budget for armed forces, including the Ministry of Defense, the Army, the IRGC, and the police, has reached at least 7.22 quadrillion rials. This amount is allocated not only within the main budget lines but also from crude oil revenue. In the 2023 budget, military appropriations totaled 5.25 quadrillion rials.
Oil Sales to Fund Military-Security Expenditures
According to Clause B of Exemption Four, 1.37 quadrillion rials’ worth of crude oil is allocated to the armed forces under the heading “strengthening defense capability.” In addition, 1.8 billion euros in crude oil is earmarked for “special projects” for the military, but due to its confidentiality, little information is available. Thus, as outlined in Budget Table 21 for 2024, the armed forces will receive over 2.53 quadrillion rials from oil quotas.
In his continued pursuit of warmongering policies, Khamenei stated, “The quality of expressing the nation’s power and will must be determined by the officials, and what is in the nations and country’s best interest must be done.” This anti-people policy is clearly reflected in Pezeshkian’s government military budget.
On October 29, Euronews reported that the budget allocated to Iran’s military forces next year is expected to be around 2.17 quadrillion rials. According to estimates by the Stockholm International Peace Research Institute (SIPRI), Iran’s regime spent $10.3 billion on military expenses in 2023. The IRGC’s share of total military expenditures in 2019 was about 27 percent, rising to 37 percent in 2023.
According to Clause One, Exemption Three of the 2025 budget proposal of the 11.96 quadrillion rials in revenue from crude oil, gas, and condensate exports, 5.61 quadrillion rials will be allocated to the armed forces to “strengthen defense capability.” This amount is four times the oil quota allocated to the armed forces in the 2024 budget. In addition, another 1.26 quadrillion rials is earmarked as “other allocations for specific projects,” likely distributed among military and security institutions.
In defense of the budget proposal, Pezeshkian said: “We obtained permission from the supreme leader to use some foreign exchange, usually reserved mid-year to cover deficits and address social protests.”
Despite severe concerns within the regime about uprisings by millions of impoverished citizens, budgetary imbalances and deficits have left no other options for the people than rising prices, inflation, and worsening poverty. Final uprisings soon are inevitable and unavoidable. Increased pressure on the suffering people will pave the way for the courageous and aware youth of Iran to rise until the flames of their struggle engulf the oppressors.
Source » eurasiareview