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President Mahmoud Ahmadi-Nejad says he likes to check Iran’s economic pulse in his own neighbourhood in eastern Tehran. He once told MPs in response to criticisms about rising prices to go and buy their tomatoes from Narmak. And he is fond of mentioning favourite shopkeepers in Narmak who he claims have helped him to understand the country’s economic hardships.

“There is an honourable butcher in our neighbourhood who knows all the economic problems of the people,” Mr Ahmadi-Nejad said recently. “I get my economic information from him.” A visit to Narmak this week, however, shows Iranians’ growing economic frustrations. The imposition of petrol rationing, which provoked the burning of 10 petrol stations on Tuesday night, came on top of a recent fuel price rise and steep increases in the cost of housing and dairy products. The economic pressures are threatening to tarnish Mr Ahmadi-Nejad’s image as a leader who is close to his people. “Butter is now 400 tomans [43 cents] from 300 tomans only a week ago,” said a woman customer at the president’s favourite grocery shop, shaking her head. “God knows what will happen following petrol rationing.” Another shopper, a mother of two, said tearfully: “It’s a month since I started looking for a flat, but there is no way I can afford the new rents that have suddenly increased by three or four times.” Curiously, people in Narmak, who have sold the president goods for decades, say they respect Mr Ahmadi-Nejad as a decent customer who does not bargain like most others. But they do not recall being asked by him about people’s problems, either before or since he became president. Reza, a 50-year-old butcher, says he sold red meat and liver to the president for about 30 years. “He has not come shopping here since his presidency [in 2005],” he added. “I respected him like all my other customers, but he never asked me about anything.” Another butcher, who asked not to be named, thought Reza was probably the president’s main butcher. “I remember once he was angry with me for selling liver for 100 tomans [11 cents] more than what Mr Reza charged.” “The butcher he talked about is like the promises he has made to people. They are not true,” said one angry customer at the butcher’s, claiming that he had spent four hours waiting to fill his car with petrol. In spite of his frequent references to Narmak, Mr Ahmadi-Nejad has moved away from the district to another house near the presidential office in central Tehran. But according to neighbours, he returns every month or so and visits people in his small alley called Hedayat, meaning Islamic guidance. Neighbours do not know which butcher he was referring to, but talk of a 76-year-old grocer who visits the president whenever he shows up in Hedayat alley and tells him in a few minutes about the recent problems of his customers. “He doesn’t ask me questions, but only listens to me,” said Yahya Esfandiari, the grocer, who clearly holds Mr Ahmadi-Nejad in high regard, saying that the president “wants to work, but is stopped by some vipers”. Mr Esfandiari told the president about the high cost of housing last time he met the president. “He said the housing problem would be resolved in four or five months.” Source: Financial Times

Iran on Saturday dismissed the threat of fresh UN sanctions and announced an impending visit by a senior atomic watchdog official for talks over Tehran’s controversial nuclear programme. “The Iranian nation will pursue its right and the disturbances will have no effect,” supreme leader Ayatollah Ali Khamenei was quoted as saying by state-run television. Khamenei backed the defiant policy of President Mahmoud Ahmadinejad who has vowed Iran will not back down on its nuclear work in the face of international pressures.

“Iran’s foreign policy has always been offensive. Unfortunately at certain times there was a defensive policy, which was a mistake,” Khamenei said in a ceremony marking the second anniversary of Ahmadinejad’s election. “The policy of resistance to defend Iran’s (nuclear) right will continue without any faltering,” said the president. The UN Security Council has already imposed two sets of sanctions against Iran after it failed to heed ultimatums to suspend uranium enrichment, the process that makes nuclear fuel but in highly extended form can also produce the fissile core of an atomic bomb. The West suspects that Iran’s nuclear programme is a cover for a push to develop the bomb, although Iran has said repeatedly that it is for civilian purposes only. The Security Council could toughen Iran sanctions, which now target people and institutions involved in its nuclear and missiles programmes, and impose travel bans, freezing of bank accounts and inspections of Iranian cargo ships and aircraft. But in comments published on Saturday, Ahmadinejad brushed off the threat saying: “They cannot hurt us, not that they don’t want to but because they are incapable of doing so as they are in a difficult situation.” Ahmadinejad added, “The global arrogance cannot stop the Iranian nation,” in an allusion to the United States, the main ally of Israel, the only country in the Middle East believed to have a nuclear arsenal. Washington has never ruled out military action to stop Iran’s nuclear drive. Iran’s ambassador to the International Atomic Energy Agency said on Saturday that UN resolutions had only hastened Iran’s enrichment work. “At the moment Iran has speeded up its enrichment activities, so Security Council resolutions have had a positive effect on this work,” Ali Asghar Soltanieh told the student ISNA news agency. He also said that construction work on a heavy water reactor in Arak, in central Iran, was continuing without delay, despite IAEA calls to halt the work. A senior diplomat with ties to the IAEA said that Iran was already operating more than 1,300 centrifuges for enrichment by mid-May at its Natanz plant and could have 3,000 by the end of July. Under ideal conditions they could produce enough highly enriched uranium to produce a nuclear weapon within a year at most. But Iran says it is willing to resolve questions over the nature of its nuclear programme with the IAEA, which has been unable to fully verify Iran’s atomic work. Soltanieh announced meanwhile that IAEA deputy director general Olli Heinonen will visit Tehran from July 11 to 13 to “examine a work plan to respond to all remaining issues over Iran’s nuclear programme.” Soltanieh told ISNA that Heinonen, who heads the Department of Safeguards, will be accompanied by IAEA officials “who are not inspectors and will not carry out any inspections into Iran’s nuclear facilities.” Iran’s top nuclear negotiator Ali Larijani invited the IAEA team to Tehran after talks last week in Vienna with UN watchdog chief Mohamed ElBaradei. Larijani had undertaken to define within two months an action plan with the IAEA, which is demanding the possibility of checking on the ground whether Iran’s nuclear programme has military ambitions. Soltanieh said the visit will precede a new meeting between Larijani and EU foreign policy chief Javier Solana who have held talks aimed at finding a way out of the standoff.

Source: AFP

Iran’s supreme leader on Saturday threw his weight behind a gasoline rationing scheme which sparked angry protests and left more than a dozen petrol stations burnt out in the world’s fourth largest oil exporter. Supreme Leader Ayatollah Ali Khamenei, Iran’s highest authority under its system of clerical rule, hailed the government’s “bravery” in a speech to President Mahmoud Ahmadinejad and senior officials, state television reported.

Despite huge energy reserves, the Islamic Republic has limited refining capacity and imports 40 percent of its fuel needs, a sensitive issue when world powers are threatening new U.N. sanctions over Tehran’s nuclear ambitions. Seeking to rein in costly imports and soaring consumption of heavily-subsidised fuel, the government in May raised the litre price by 25 percent and on Wednesday launched a delayed plan to ration the sale of gasoline. Many motorists complained the amount of fuel they are allowed to buy, just 100 litres a month, is not enough and some lawmakers have called for a review of the allowances. But Khamenei, who has also previously defended the government against criticism on some issues, made clear he backed the move. “The issue of gasoline is one of these actions which the government bravely made a decision about,” he was quoted as saying. “And of course, by studying all of its aspects, (the implementation of) this decision should continue.” Critics say the government needed to act to put a brake on demand but that raising the price would be more efficient than artificially restricting the sale of gasoline. They say the announcement that rationing would start just hours beforehand added to public anger, leading to the torching of 19 petrol stations on Tuesday, according to media reports. Khamenei suggested the money Iran could save through the scheme — gasoline imports cost it $5 billion last year — should be used to improve living conditions. “If this huge amount decreases eventually, certainly it will be spent on issues related to people’s lives, employment and building roads and schools,” he said. The government has not said if drivers will be allowed to buy fuel above their allocation at a higher price than the subsidised rationed price of 1,000 rials (11 U.S. cents) per litre. If not, analysts say a black market is inevitable. Ahmadinejad’s economic management has faced mounting criticism from the public and the media. Some 57 economists said in a open letter this month government policies were fuelling price rises and failing to deliver the fairer society he promised when he came to power. The United States, which is leading efforts to isolate Iran over its nuclear plans, has said Iran’s gasoline imports are a point of “leverage.” Washington accuses Iran of seeking to build nuclear weapons, a charge Tehran denies.

Source: Reuters