IRAN

Islamic Republic of Iran

Jomhuri-ye Eslami-ye Iran

CAPITAL: Tehrān

FLAG: The national flag is a tricolor of green, white, and red horizontal stripes, the top and bottom stripes having the Arabic inscription Allah Akbar ("God Is Great") written along the edge nearest the white stripe. In the center, in red, is the coat of arms, consisting of a stylized representation of the word Allah.

ANTHEM: n/a

MONETARY UNIT: The rial (r) is a paper currency of 100 dinars. There are coins of 1, 5, 10, 20, and 50 rials, and notes of 100, 200, 500, 1,000, 2,000, 5,000, and 10,000 rials. r1 = $0.00011 (or $1 = r9,040.26) as of 2005.

WEIGHTS AND MEASURES: The metric system is the legal standard, but local units are widely used.

HOLIDAYS: National Day, 11 February; Oil Nationalization Day, 20 March; No Ruz (New Year), 21–24 March; Islamic Republic Day, 1 April; 13th Day of No Ruz (Revolution Day), 2 April. Religious holidays (according to the lunar calendar) include Birthday of Imam Husayn; Birthday of the Twelfth Imam; Martyrdom of Imam 'Ali; Death of Imam Ja'afar Sadiq; 'Id al-Fitr; Birthday of Imam Reza; 'Id-i-Qurban; 'Id-i-Qadir; Shabi-Miraj; Martyrdom of Imam Husayn; 40th Day after the Death of Imam Husayn; Birthday of the Prophet; Birthday of Imam 'Ali.

TIME: 3:30 pm = noon GMT.

LOCATION, SIZE, AND EXTENT

Situated in southwestern Asia, Iran covers an area of 1,648,000 sq km (636,296 sq mi) and extends about 2,250 km (1,398 mi) se–nw and 1,400 km (870 mi) ne–sw. Comparatively, the area occupied by Iran is slightly larger than the state of Alaska. Iran is bounded on the n by Armenia, Azerbaijan, Turkmenistan, and the Caspian Sea, on the e by Afghanistan and Pakistan, on the s by the Gulf of Oman and the Persian Gulf, on the w by Iraq, and on the nw by Turkey, with a total land boundary length of 5,440 km (3,380 mi). The coastline is 2,440 km (1,516 mi). The shoreline on the Caspian Sea is 740 km (460 mi). Iran's territory includes several islands in the Persian Gulf.

Iran's capital city, Tehrān, is located in the northwestern part of the country.

TOPOGRAPHY

Most of the land area consists of a plateau some 1,200 m (4,000 ft) above sea level and strewn with mountains. The Zagros and Elburz ranges stamp a "V" upon the plateau; the apex is in the northwest, and within the lower area between the arms are to be found salt flats and barren deserts. Most of the drainage is from these two great ranges into the interior deserts, with limited drainage into the Caspian Sea and the Persian Gulf. The ranges run in parallel files, enclosing long valleys that provide most of the agricultural land. Qolleh-ye Damāvand (Mt. Damavand), northeast of Tehrān, rises to 5,671 m (18,605 ft), while the Caspian littoral is below sea level and has a semitropical climate. Only the Kārūn River, emptying into the Persian Gulf, is navigable for any distance, but the rivers that rush down from high altitudes offer fine sources of power. Harbors of limited depth are found along the Persian Gulf, and the Caspian Sea has similar facilities for coastal fishing and trade.

Iran is geologically unstable with some of the most severe and deadliest earthquakes on record. On 20 June 1990, a 7.4 magnitude quake caused the death of about 50,000 people, many of whom were caught in resulting landslides. On 10 May 1997, a 7.3 magnitude quake occurred in northern Iran causing the deaths of at least 1,567 people; another 2,300 were injured and 50,000 were left homeless. A 6.6 magnitude quake on 26 December 2003 left about 31,000 people dead. On 22 February 2005, a 6.4 magnitude quake in Kerman province in central Iran left at least 602 people dead and 991 injured.

CLIMATE

Iran has a continental type of climate, with cold winters and hot summers prevalent across the plateau. The annual rainfall does not exceed 30 cm (12 in), with the deserts and the Persian Gulf littoral receiving less than 13 cm (5 in). Snow falls heavily on the mountain peaks and is the principal source of water for irrigation in spring and early summer. The Caspian littoral is warm and humid throughout the year, and the annual rainfall is about 100–150 cm (40–60 in). Clear days are the rule, for the skies are cloudless more than half the days of each year. The seasons change abruptly. By the Persian New Year (the first day of spring), orchards are in bloom and wild flowers abound. In January, the Tehrān temperature ranges from an average low of -3°c (27°f), to an average high of 7°c (45°f); and in July, from an average minimum of 22°c (72°f) to an average maximum of 37°c (99°f).

FLORA AND FAUNA

More than one-tenth of the country is forested. The most extensive growth is found on the mountain slopes rising from the Caspian Sea, with stands of oak, ash, elm, cypress, and other valuable trees. On the plateau proper, areas of scrub oak appear on the best-watered mountain slopes, and villagers cultivate orchards and grow the plane tree, poplar, willow, walnut, beech, maple, and mulberry. Wild plants and shrubs spring from the barren land in the spring and afford pasturage, but the summer sun burns them away. Bears, wild sheep and goats, gazelles, wild asses, wild pigs, panthers, and foxes abound. Domestic animals include sheep, goats, cattle, horses, water buffalo, donkeys, and camels. The pheasant, partridge, stork, and falcon are native to Iran.

As of 2002, there were at least 140 species of mammals, 293 species of birds, and over 8,000 species of plants throughout the country.

ENVIRONMENT

Iran's high grasslands have been eroded for centuries by the encroachment of nomads who overgrazed their livestock. Desertification resulting from erosion and deforestation of the high plateau pose additional dangers to Iran's environment. United Nations (UN) sources have estimated that 1–1.5 million hectares (2.5–3.7 million acres) per year become desert land. The basic law controlling the use of forests dates from 1943. In 1962, the forests and pastures in Iran were nationalized in an effort to stop trespassing deforestation.

In early 1983, blown-out oil wells in the Persian Gulf war zone between Iran and Iraq caused a huge oil slick that threatened ocean and shore life along the southwestern Iranian coast. Air and water pollution continued to be significant problems in Iran in the aftermath of the 1991 Persian Gulf War. The water in the Persian Gulf is polluted with oil and black rain, and the burning of Kuwaiti oil wells caused significant air pollution as well. Iran also has the 19th-highest level of industrial carbon emissions in the world. Iran has 129 cu km of renewable water resources with 92% used for farming activity and 2% used for industrial purposes. The country has a large network of underground water canals called qanats. This network, once used as an irrigation source, covers an estimated 400,000 km (248,548 mi). Some analysts are encouraging a return to this source of irrigation waters as an answer to regional water shortages. Only 83% of the rural people have pure drinking water.

Iran's Department of Environment was established under the Environment Protection and Enhancement Act of 1974; no information is available on how well the legislation has been implemented. In 2003, about 4.8% of the total land area was protected.

According to a 2006 report issued by the International Union for Conservation of Nature and Natural Resources (IUCN), threatened species included 21 types of mammals, 18 species of birds, 8 types of reptiles, 4 species of amphibians, 14 species of fish, 3 species of invertebrates, and 1 species of plant. Endangered species in Iran include the Baluchistan bear, Asiatic cheetah, Persian fallow deer, Siberian white crane, hawksbill turtle, green turtle, Oxus cobra, Latifi's viper, dugong, and dolphins. The Syrian wild ass has been listed as extinct.

POPULATION

The population of Iran in 2005 was estimated by the United Nations (UN) at 69,515,000, which placed it at number 18 in population among the 193 nations of the world. In 2005, approximately 4% of the population was over 65 years of age, with another 30% of the population under 15 years of age. There were 103 males for every 100 females in the country. According to the UN, the annual population rate of change for 2005–10 was expected to be 1.2%, a rate the government viewed as too high. Since 1990, the government has had some success in reducing fertility rates; in 1990, there were 5 births per woman and by 2003, the number had declined to 3.5 births per woman. The projected population for the year 2025 was 89,042,000. The population density was 42 per sq km (110 per sq mi).

The UN estimated that 67% of the population lived in urban areas in 2005, and that urban areas were growing at an annual rate of 2.23%. The capital city, Tehrān, had a population of 7,190,000 in that year. The populations of other major metropolitan areas were Mashhad, 2,147,000; Esfahān, 1,547,000; Tabriz, 1,396,000; Shirāz, 1,230,000; Ahvāz, 967,000; and Kermānshāh, 949,000.

MIGRATION

Until the late 20th century, there was little immigration to Iran, with the exception of Shia Muslims coming from Iraq. There has been some emigration to Europe and the United States, particularly by Iranians who were studying overseas at the time of the revolution of 1979. About 100,000 Kurds were repatriated from Iran to Iraq during the mid-1970s after the suppression of a Kurdish rebellion in the latter country. Between 1980 and 1990, however, an increased number of Shia Muslims fled Iraq because of the Iran-Iraq and Gulf wars; at the end of 1992, some 1.2 million were refugees in Iran. Perhaps 2.8 million Afghan refugees moved to Iran after the Soviet invasion of Afghanistan in December 1979. About 200,000 returned in 1992, and about 2.1 million remained in mid-1993. At least 50,000 refugees from Azerbaijan had fled to Iran by late 1993 to escape Armenian occupation. In the fall of 1996, some 65,000 Iraqi Kurds entered Iran due to ethnic fighting.

According to 1999 statistics, Iran had the largest refugee population in the world, hosting some two million refugees, mainly Afghans and Iraqis. An increase in unemployment and faltering economic conditions resulted in increased pressure for refugees to return to their homelands. However, due to conditions in Iraq and Afghanistan, chances for significant repatriation remained poor. The Iranian government felt a heavy economic and social burden and sought help from the international community. The total number of migrants in the country was 2,321,000 in 2000, down from 3,809,000 ten years earlier. In 2003 Iran had a million refugees. The number increased to 1,045,976 in 2004, with 698 returned refugees. Afghanistan and Iraq were the source of refugees—952,802 and 93,103, respectively. Nearly a million Iranians were refugees in seven countries in that same year, primarily in Germany and the United States. In 2004 nearly 14,000 Iranians sought asylum in 16 countries, primarily in Turkey, Germany, and the United Kingdom. In 2004, Iran was the main asylum country, accounting for 11% of all refugees under the mandate of the United Nations High Commissioner for Refugees (UNHCR).

In 2005 the net migration rate was estimated as -2.64 migrants per 1,000 population. The government views the immigration level as too high, but the emigration level as satisfactory.

ETHNIC GROUPS

Present-day Iranians, or Persians, are considered to be direct descendants of the Aryans who moved into the plateau in the second millennium bc. They speak Persian, or Farsi, and number more than half the total population. In the Zagros range and its extensions are to be found the Kurds, Lurs, Bakhtiari, Qashqa'i, and Qajars; the first three are said to be of stock similar to the Iranian element, and they speak languages that stem from ancient Indo-European languages. At various times after the 10th century ad, Turkish tribes settled in the region, and Turkish-speaking groups are still found in several parts of the country. One-eighth of the total population dwells in East and West Azerbaijan, and there are sizable groups of Azerbaijanis in major cities elsewhere, including Tehrān. Arab groups arrived during and after the 7th century ad; their descendants live in the south and southwest and in scattered colonies elsewhere.

In general, non-Iranian elements are to be found along the perimeter of the country. Of these, certain nomadic groups move back and forth across the frontiers. Tribal groups have been a conspicuous element in Iran for many centuries, migrating vertically in spring and fall between high mountain valleys and hot, lowland plains. The important migratory groups include the Qashqa'i, Qajars, Bakhtiari, Balochi, and Turkmen. A large proportion of these people are now settled, however. The nomadic way of life is on the decline, and official policy has sought to resettle these groups on farmlands.

According to the latest estimates, Persians account for 51% of the population, Azeri 24%, Gilaki and Mazandarani 8%, Kurds 7%, Arab 3%, Lur 2%, Balochi 2%, and Turkmen 2%.

LANGUAGES

Farsi, commonly called Persian in the West, is the official language of Iran. An Indo-European language of the Indo-Iranian group, Farsi derives from ancient Persian, with an admixture of many Arabic words. Arabic characters and script are used in writing modern Persian. Dialects of Turkish, or Turki—especially Azeri, the language of the Azerbaijanis—are spoken throughout northwestern Iran, by the Qashqa'i tribe in the southwest, and in parts of the northeast by Turkmen tribes and others. The Lurs, Kurds, and Bakhtiari have languages and dialects of their own that descend from earlier Indo-European languages, and the Balochi language spoken in southeastern Iran also is of Indo-European origin. A small number of Brahui in the southeast speak a Dravidian language. About 58% of the population speaks Persian or Persian dialects, 26% Turkic or Turkic dialects, 9% Kurdish, 2% Luri, 1% Balochi, 1% Arabic, 1% Turkish, and 2% other.

RELIGIONS

Iran is the only Islamic country where Shia Muslims hold the reins of power. Shia Islam is the official religion of the country and the president, prime minister, and cabinet ministers must be Muslims. As of 2004, about 99% of the population were Muslim, with 89% of the people being Shia Muslims and 10% Sunni Muslims. The largest non-Muslim group was the Baha'i faith, with between 300,000 and 350,000 members. Their faith, which sprang from the teachings of a 19th-century Muslim in Iran, has been denounced as heresy to Islam. The Baha'is have been severely persecuted by the Shia government since the 1979 revolution, and many of their religious leaders have been executed. The Jewish community has between 20,000 and 30,000 members. There are about 300,000 Christians, including Nestorian Christians (Assyrians). About 35,000 people adhere to the tenets of Zoroastrianism. The Mandaeans (between 5,000 and 10,000 people) practice a pre-Christian form of gnosticism.

The government openly restricts the freedom of religion. The constitution declares Shia Islam as the official religion and guarantees some freedom to Zoroastrians, Jews, and Christians; however, other religious groups have been persecuted for their beliefs.

TRANSPORTATION

Iran had 178,152 km (110,811 mi) of roads in 2002, of which 118,115 km (73,468 mi) were paved, including 751 km (467 mi) of expressways. A1, a major paved highway, runs from Bazargan on the Turkish border to the border with Afghanistan. Another major highway, A2, runs from the Iraqi border to the Pakistani border. Much of the revolutionary government's road-building activity centered on improving roads in rural areas. In 2003 there were over 2,578,850 passenger cars and 666,550 commercial vehicles.

The state-owned Iranian State Railway has 7,203 km (4,480 mi) of broad and standard gauge track, as of 2004. Standard gauge accounts for nearly all—or 7,109 km (4,422 mi)—of all railroad right-of-way. The main line runs south for 1,392 km (865 mi) from Bandar Turkoman on the Caspian Sea, through Tehrān, to Bandar-e Khomeini on the Persian Gulf. Rail construction from Bafq to Sirjan has been completed and is operational.

Iran's main ports at Khorramshahr and Ābādān on the Persian Gulf were largely destroyed in fighting during the 1980–88 war with Iraq. Khorramshahr was restored to operation by November 1992. Other ports on the Gulf are Bandar-e Khomeini, Bandar-e 'Abbās, and Bandar-e Būshehr. Both Bandar-e Khomeini and Bandar-e Būshehr were damaged because of the war. The government was continuing the program to modernize the port at Bandar-e 'Abbās. On the Caspian Sea, there are the ports of Bandar Anzeli (formerly Bandar Pahlavi) and Naushahr. In addition, there are the oil shipment ports of Kharg Island (a principal target in the war with Iraq) and Ābādān. As of 2004, there were 850 km (529 mi) of inland waterways on Daryācheh-ye Orūmiyeh (Lake Orumieh) and the Kārūn River. In addition, the Shatt al Arab is usually navigable by maritime traffic for about 130 km (81 mi). In 2005, the Iranian merchant marine included 144 vessels of at least 1,000 gross registered tonnage (GRT), with a total capacity of 4,715,242 GRT.

Iran had an estimated 305 airports in 2004, 129 of which had paved runways as of 2005; there were 15 heliports. Principal airports include Bandar-e 'Abbās, Mehrabad International at Tehrān, and Shirāz International at Shirāz. The state-owned Iran Air maintains frequent service to 15 cities in Iran and is an international carrier. In 2003, about 9.554 million passengers were carried on scheduled domestic and international flights.

HISTORY

As early as 6000 bc, communities on the Iranian plateau were carrying on agriculture, raising domestic animals, and producing pottery and polished stone implements. Sites datable to later than 3000 bc are numerous and offer quantities of bronze instruments and painted pottery of the finest types. About 1500 bc, masses of Indo-Europeans, or Aryans, began to cross the plateau of Iran. The Iranian group included Medes, Persians, Parthians, Bactrians, and others. The Medes settled in western Iran (Media) about 900 bc and established their capital at Ecbatana (modern Hamadān); the Persians settled to the south of them (Parsis) around 700 bc. The Median king Cyaxares (625–585 bc), along with the Chaldeans, destroyed the power of neighboring Assyria. In the area of Parsis, the Achaemenid clan became overlords, and in 550 bc, their leader, Cyrus the Great, revolted against the Medes; forming a union of Medes and Persians, he then drove with armies both into Asia Minor and to the east of the Iranian plateau and established the Achaemenid Empire. Cambyses, Darius, Xerxes I, and Artaxerxes I were notable rulers of this line who penetrated Greece, Egypt, and beyond the Oxus. The Achaemenid power was centered at Susa and Persepolis; the ruined site of the latter is impressive even today. Zoroastrianism was the religion of the rulers.

In his eastward sweep (334–330 bc), Alexander the Great defeated vast Achaemenid forces and went on to capture Susa and to burn Persepolis. In the 3rd century bc, the Parthians moved into the area east of the Caspian and then into the Achaemenid Empire, establishing the new Parthian kingdom; later rulers moved west to come in contact with and then to fight the Roman Empire. The Parthians considered themselves spiritual heirs of the Achaemenids and adopted Zoroastrianism as the official religion. Weakened by long wars with Rome, the Parthians were followed by a local dynasty, the Sassanian, which arose in the area of Fars in southwestern Iran. Wars with Rome continued and were followed by a struggle with the Byzantine Empire. The Sassanian period (ad 226–641) was one of cultural consolidation and was marked by economic prosperity and by a series of enlightened rulers.

During the first half of the 7th century ad, Arab warriors burst out of the Arabian Peninsula to overwhelm the Sassanian Empire and to spread the teachings of the prophet Muhammad, embodied in Islam. By the opening of the ninth century, Islamic doctrine and precepts had spread over the plateau, and local dynasties faithful to the Muslim creed emerged. Early in the 11th century, the Turkish Ghaznavid dynasty held power from western Iran to the Indus River. Their greatest ruler was Mahmud of Ghaznī, a renowned conqueror and a patron of the arts. The Ghaznavids were replaced by the Seljuks, descended from Turkish nomad warriors enlisted in their service.

The Seljuk kingdom had its capital at Ray, just south of Tehrān, and stretched from the Bosporus to Chinese Turkestan. Of rude origins, such rulers as Tughril Beg, Alp Arslan, and Malik Shah did much to promote cultural pursuits and enhance the character of Persian civilization.

In 1219, Mongol hordes under Genghis Khan (Temujin) began to move into Iran; successive waves subdued and devastated the country. Hulagu, a grandson of Genghis, settled in Maragheh in Azerbaijan and as Il-khan, or chief of the tribe, gave this title to the Il-khanid dynasty. His successors, such as Ghazan Khan and Oljaitu, ruled from Tabriz and Sultaniya, and once again untutored invaders became converts to Islam and patrons of Persian science, learning, and arts. Rivalries within the military leadership brought about the breakdown of Il-khanid power in the second half of the 14th century.

In 1380, Timur ("Timur the Lame," or, in the West, Tamerlane) began to move into the Iranian plateau from the east. Within a decade, the entire area was in his power, bringing a renaissance of culture at Herāt (in modern Afghanistan) and other towns, but later rulers lacked the force and ability to hold the empire together. Early in the 16th century a number of smaller, local dynasties emerged throughout Iran. The most powerful was the Safavid dynasty, whose leaders, descendants of a spiritual head of the Shia sect, imposed this form of Islam on their subjects. The fourth and greatest of this line, Shah Abbas (r.1587–1628), moved the capital to Esfahān, where he had many splendid buildings constructed. The Safavid period, marked by the emergence of a truly native Iranian dynasty after the lapse of many centuries, was a period of military power and general prosperity. However, decline set in, and in 1722, Esfahān fell to invading forces from Afghanistan. Nadir Shah, an Afshar tribesman from the north, drove off the Afghans and in 1736 established the Afshar dynasty. By the end of the 18th century, Zand rulers, dominant in the south, were replaced by the Qajars, a Turkish tribe.

Qajar power began to fade at the turn of the 19th century. In the 1890s, Shia clerics led a national boycott that made the shah rescind a decree awarding a tobacco monopoly to a foreign agent. In 1906, a coalition of bazaar merchants, clerics, intellectuals, and tribal leaders forced the shah to accept a constitution. Th is liberal initiative was frustrated, however, by the power of the British and Russians, who controlled spheres of influence in the south and north of Iran.

After a period of chaos, the British arranged for a Persian cossack officer, Reza Khan, to come to power, first (in 1921) as minister of war in 1921, then as prime minister, and finally (in 1925) as Reza Shah, the first sovereign of the Pahlavi dynasty. With ruthless authority, he sought to modernize Iran along the lines of Ataturk in Turkey. In 1941, suspecting him of pro-German sympathies, the British forced Reza Shah to abdicate in favor of his 21-year-old son, Muhammad Reza. British and Russian forces set up a supply line across Iran to the USSR. In April 1946, the British left, but the USSR refused to withdraw its forces. Under pressure from the United Nations (UN) and the United States, Soviet troops withdrew in December 1946.

Oil, the source of nearly all Iran's national wealth, quickly came to dominate politics after World War II. Muhammad Mossadeq, who, as leader of the National Front in the national assembly (Majlis), led the fight in 1947 to deny the USSR oil concessions in northern Iran, became chairman of the oil committee of the Majlis. On 15 March 1951, the Majlis voted to nationalize the oil industry, which was dominated by the Anglo-Iranian Oil Co. (AIOC), a prewar concession to the United Kingdom. When the government of Prime Minister Hosein Ala took no immediate action against the AIOC, the Majlis demanded his resignation and the appointment of Mossadeq, who became prime minister in April. The AIOC was nationalized, but its output rapidly declined when the United Kingdom imposed an embargo on Iranian oil, as well as other economic sanctions. As Iran's economic situation worsened, Mossadeq sought to rally the people through fervent nationalistic appeals. An attempt by the shah to replace him failed in the summer of 1952, but by August 1953, Mossadeq had lost his parliamentary majority, but not his popular support. With the backing of a referendum, Mossadeq dissolved the Majlis and then refused to resign when the shah again tried to oust him. The shah fled Iran for four days, but returned on 22 August with backing from the military, the United States, and the United Kingdom. A new conservative government issued an appeal for aid; in September, the United States granted Iran $45 million. Mossadeq was convicted of treason in December.

After 1953, the shah began to consolidate his power. New arrangements between the National Iranian Oil Co. and a consortium of US, UK, and Dutch oil companies were negotiated during April–September 1954 and ratified by the Majlis in October. The left-wing Tudeh (Masses) Party, which had been banned in 1949 but had resurfaced during the Mossadeq regime, was suppressed after a Tudeh organization was exposed in the armed forces. In 1957, two new pseudo-parties (both government-sponsored) arose; both contested parliamentary elections in 1960 and 1961. Meanwhile, Iran became affiliated with the Western alliance through the Baghdād Pact (later the Central Treaty Organization) in 1955. (CENTO was dissolved after Iran pulled out in 1979.) Frontier demarcation agreements were signed with the USSR in April 1957.

US assistance and goodwill were essential for the shah. In 1961, President John F. Kennedy urged him to undertake a more liberal program. Under the "white revolution" of 1962–63, the shah initiated land reform, electoral changes (including, for the first time, the right of women to hold and vote for public office), and broad economic development. Opposition to the reform program, the dictatorial regime, and the growing American influence was suppressed. Political dissent was not tolerated.

The shah's autocratic methods, his repressive use of the secret police (known as SAVAK), his program of rapid Westernization (at the expense of Islamic tradition), his emphasis on lavish display and costly arms imports, and his perceived tolerance of corruption and of US domination fed opposition in the late 1970s. The economic boom of the previous 15 years also came to an end. Islamic militants, radical students, and the middle class all joined in the revolt, until virtually the entire population turned against the shah. Following nine months of demonstrations and violent army reactions, martial law was declared in Iran's major cities in September 1978, but antigovernment strikes and massive marches could not be stopped. On 16 January 1979, the shah left Iran, appointing an old-line nationalist, Shahpur Bakhtiar, as prime minister. However, the leader of the Islamic opposition, Ayatollah Ruhollah Khomeini (the term ayatollah is the highest rank of the Shia clergy), who had spent 15 years in exile, first in Iraq and briefly in France, refused to deal with the Bakhtiar regime. Demonstrations continued, and on 1 February the ayatollah returned to a tumultuous welcome in Tehrān. He quickly asserted control and appointed a provisional government, which took power after a military rebellion and the final collapse of the shah's regime on 11 February.

After a referendum, Khomeini on 1 April declared Iran an Islamic republic. However, the provisional government, led by Medhi Bazargan and other liberal civilians, was unable to exercise control; revolutionary groups made indiscriminate arrests and summary executions of political opponents. Increasingly, radical clerics sought to take power for themselves. The crisis atmosphere was intensified by the seizure, on 4 November 1979, of more than 60 US hostages (50 of them in the US embassy compound in Tehrān) by militant Iranian students who demanded the return of the shah from the United States (where he was receiving medical treatment) to stand trial in Iran. Despite vigorous protests by the US government, which froze Iranian assets in the United States, and by the UN over this violation of diplomatic immunity, 52 of the hostages were held for 444 days; in the intervening period, a US attempt to free the hostages by military force failed, and the shah died in Egypt on 27 July 1980. The crisis was finally resolved on 20 January 1981, in an agreement providing for release of the prisoners and the unfreezing of Iranian assets. A new constitution providing for an Islamic theocracy was ratified by popular referendum in December 1979. In presidential elections in January 1980, 'Abolhassan Bani-Sadr, a moderate who supported the revolution, was elected president. Later elections to the Majlis resulted in victory for the hard-line clerical Islamic Republican Party (IRP).

In June 1981, President Bani-Sadr was ousted by Khomeini; later that month, a bomb explosion at IRP headquarters in Tehrān killed Ayatollah Beheshti, who had been serving as chief justice, as well as 4 cabinet ministers, 20 paramilitary deputies, and dozens of others. Another bombing, on 30 August, killed the new president, Muhammad 'Ali Rajai, and his prime minister, Muhammad Javad Bahonar. The bombings were ascribed by the government to leftist guerrillas. By 1982, at least 4,500 people had been killed in political violence, and some estimates placed the total much higher. In September 1982, Sadegh Ghotbzadeh, who had been foreign minister during the hostage crisis, was executed on charges of plotting to kill Khomeini and establish a secular government.

Iraq, meanwhile, had taken advantage of Iran's political chaos and economic disorder to revive a border dispute that had been settled in 1975 when Iranian and Iraqi representatives reached agreement on the demarcation of their frontiers. Full-scale war erupted in September 1980, when Iraq demanded sovereignty over the entire Shatt al Arab waterway. Iraqi forces invaded Khuzistan in the southwest, and captured the town of Khorramshahr and the oil refinery center of Ābādān. The Iranian army, decimated by the revolution, was slow to mobilize, but by June 1982 it had driven Iraqi soldiers out of Ābādān and Khorramshahr and from all undisputed Iranian territory. Iran then launched its own offensive, invading Iraq and thrusting toward Al Başrah (Basra), but failed to make significant gains. At this point the land war became stalemated, with Iranian and Iraqi troops setting up an elaborate system of trenches. In 1983, Iraq broadened the war zone to include oil-tanker traffic in the northern Persian Gulf.

The Iraqis first attacked Iranian oil installations, disrupting, but not stopping, oil exports from the main oil terminal at Kharg Island. In mid-1983, Iraq took delivery of French jets bearing Exocet missiles. Iran responded that it would close the Strait of Hormuz if Iraq used the missiles. The United States declared the strait a vital interest and said it would use military force to keep the strait open because of the large volume of oil that passed through it on the way to the West. During 1983, the Iraqis also began to attack civilian targets in Iran with long-range missiles. The attacks caused heavy casualties, and Iran responded by shelling Iraqi border cities. In 1984, Iran began to attack Arab shipping in the Persian Gulf.

Iranian forces staged a surprisingly effective attack on Iraqi forces in the Fao Peninsula in February 1986. The Iranians now controlled Iraq's entire border on the Persian Gulf and were in reach of the major Iraqi city of Al Başrah. In April, Khomeini renewed his demands for an end to the war: Iraqi president Saddam Hussein must step down and Iraq must admit responsibility and pay war reparations. Iran rejected all demands for a cease-fire and negotiations until these demands were met.

In November 1986, it was revealed that US national security adviser Robert McFarlane had secretly traveled to Iran to meet with government leaders. The United States supplied Iran with an estimated $30 million in spare parts and antiaircraft missiles in hopes that Iran would exert pressure on terrorist groups in Lebanon to release American hostages. In the wake of this affair, Iran in 1987 attacked Kuwaiti oil tankers reregistered as American tankers and laid mines in the Persian Gulf to disrupt oil tanker shipping. The United States responded by stationing a naval task force in the region and attacking Iranian patrol boats and oil-loading platforms; in the process, the United States accidentally shot down a civilian passenger jet.

As the war continued to take a heavy toll in casualties and destruction and economic hardships persisted on the home front, the clerics maintained firm control through repression and Khomeini's charismatic hold over the people. In 1988, Iran finally yielded to terms for a cease-fire in the war. On 3 June 1989, a few months after calling for the death of novelist Salman Rushdie for blasphemy, Khomeini died of a heart attack. Over three million people attended his funeral. He was succeeded as the country's spiritual guide by Ali Khamenei. On 28 July 1989, speaker of the parliament Ali Akbar Rafsanjani, a moderate, was elected president with 95% of the vote. Iran remained neutral during the Gulf War, receiving (and retaining) Iraqi planes that were flown across the border for safekeeping. Iran also accepted thousands of Kurdish refugees from Iraq to add to its heavy burden of Afghan refugees from the civil strife in that country. Inflation, shortages, and unemployment—the products of revolution, war, and mismanagement—continued to generate widespread popular discontent, fueled also by dissatisfaction with the closed and repressive political system.

President Rafsanjani was reelected by a significantly smaller margin in 1993 but continued to press for free-market economic reforms. Rising prices in the wake of decreased government economic subsidies led to civil unrest in 1994 and 1995. Clerical conservatives led by Khamenei continued to battle the political moderates for dominance in the 1996 parliamentary elections, without a decisive victory for either side. Then, in the presidential election of May 1997, a moderate cleric, Mohammad Khatami, who favored economic reform, a more conciliatory foreign-policy stance, and less rigid clerical control of the government, won over two-thirds of the vote. In spite of continued opposition by Islamic conservatives, Khatami established a more tolerant climate in the country and expanded civil liberties. His policies received a decisive endorsement by the Iranian electorate when a political coalition led by the reformist president won 141 out of 290 parliamentary seats in the February 2000 elections and 189 seats in the May runoff elections, despite the shutdown of over a dozen liberal newspapers by conservative elements in the government in the weeks preceding the May polling. On 8 June 2001, Khatami won a landslide reelection victory, securing nearly 80% of the popular vote.

US president George W. Bush, in his 29 January 2002 State of the Union address, labeled Iran—along with Iraq and North Korea—an "axis of evil," responsible for seeking out weapons of mass destruction and supporting terrorists. Khatami, who long advocated a more pro-Western stance, urged anti-US demonstrators to turn out in large numbers to protest the speech, as the speech had come as a surprise. Although Iran did not support the US-led military campaign in Afghanistan to oust the Taliban regime in late 2001, it had expressed sympathy toward US citizens after the 11 September 2001 attacks on the United States, and stated that it would aid any US service personnel in need on Iranian territory during the war in Afghanistan. Iran supported a greater role for the UN in Afghanistan, and pledged resources to help train an Afghan army. Iran was concerned with securing its border with Afghanistan to prevent further destabilization of the region.

In January 2003, in an effort to avoid war Iran urged Iraq to cooperate with UN resolutions requiring it to disarm itself of weapons of mass destruction. Iran took the position that the United States must not take unilateral military action in the dispute, and said that it would not participate or allow its territory to be used in any military action against Iraq. The Iraq War began on 19 March 2003.

While Khatami was in office, a youth movement formed representing people who rejected the rule of Iran's hardline clerics and the "Islamic democracy" of the reformers. Many sought to live in a state based on the rule of law where the clergy's rule is abolished. In November 2002, Hashem Aghajari, a history professor, was sentenced to death on charges of insulting Islam. He had given a speech in which he stated that each generation should reinterpret aspects of Islam rather than simply following religious leaders. Thousands of students protested against the ruling—the largest in three years.

Parliamentary elections, which marked the end of the campaign for political and social reform, were held on 20 February 2004. The conservative Guardian Council disqualified 43% of the 8,000 candidates who had entered the election, including most reformist incumbents who ran. There were calls for a boycott of the election. Reformists who chose to contest the election took only about 20% of the seats decided in the first round of voting. The conservative win was consolidated in the second round of voting in May. Another victory for conservatives came with the 2005 presidential election, when the ultraconservative former mayor of Tehrān, Mahmoud Ahmadinejad, beat former president Akbar Hashemi Rafsanjani with more than 61% of the vote in the second round. Ahmadinejad appealed to the poor in securing his win.

On 26 December 2003 more than 31,000 people were killed in an earthquake in the Kerman province of southeast Iran. The city of Bām—including its famous Citadel and 85% of all buildings—was largely destroyed. On 22 February 2005 more than 600 people were killed in an earthquake near the city of Zarand, Kerman province.

The European nations of France, Germany, and the United Kingdom led efforts to persuade Iran to give up its nuclear research program. By 2005, Iran resumed what it claimed was a civilian nuclear research program, but which Western nations fear could be used to develop nuclear arms.

GOVERNMENT

Before the 1979 revolution, Iran was an absolute monarchy, with the constitution of 1906 modified in 1907 and amended in 1925, 1949, and 1957. The shah was the chief of state, with sweeping powers. He commanded the armed forces, named the prime minister and all senior officials, and was empowered to dissolve either or both legislative houses. The legislative branch comprised the national assembly (Majlis) and the senate. Members of the Majlis were elected for four-year terms from 268 constituencies by adults 20 years of age and older. Half of the 60 senators were named by the shah, and half were elected. Members of the Majlis ostensibly represented all classes of the nation, while the somewhat more conservative Senate consisted of former cabinet ministers, former high officials, and retired generals.

The constitution of December 1979, which was approved in a public referendum and revised in 1989, established an Islamic republic in conformity with the principles of the Shia faith. Guidance of the republic is entrusted to the country's spiritual leader (faqih ) or to a council of religious leaders. An appointed Council of Guardians consists of six religious leaders, who consider all legislation for conformity to Islamic principles, and six Muslim lawyers appointed by the supreme judicial council, who rule on limited questions of constitutionality. In accordance with the constitution, an 86-member Assembly of Experts chooses the country's spiritual leader and may nullify laws that do not conform to Islamic tenets. In 1998, seats on the council (which have eight-year terms) were opened for the first time to nonclerics.

The executive branch consists of a president and council of ministers. The president is elected by popular vote to a maximum of two consecutive four-year terms and supervises government administration. Candidates for the presidency and parliament must have the approval of Iran's spiritual leaders. The Majlis consists of 290 members elected directly to four-year terms. Iran has the lowest voting age in the world: suffrage is universal for those ages 15 and over.

There were more than 800 candidates for president in 2001, and the Council of Guardians narrowed them to 10. Mohammad Khatami was the sole moderate, with all of the other candidates having ties to conservative or hard-line parties. On 8 June 2001, Khatami secured 77% of the popular vote, with four-fifths of 43 million eligible voters turning out. In 2005, more than 1,000 candidates initially put forth their names for president, but the Council of Guardians disqualified all but seven. In the run-off election held on 24 June 2005, former president Akbar Hashemi Rafsanjani faced Tehrān mayor Mahmoud Ahmadinejad. In a surprise victory, Ahmadinejad beat Rafsanjani with more than 61% of the vote. Almost 60% of all eligible voters turned out to cast their ballots. The next presidential election was scheduled for 2009.

POLITICAL PARTIES

During the reign of Reza Shah (1925–41), political parties were not permitted to function. After 1941, parties sprang up, but most of them were of an ephemeral nature. The Communist-oriented Tudeh (Masses) Party was better organized than the others and benefited from the services of devoted followers and foreign funds. In 1949, an unsuccessful attempt to assassinate the shah was traced to the Tudeh, and it was banned. It continued to work through front groups, and its views were reflected in some periodicals, but the organization was extinguished in the shah's post-1953 crackdown.

In 1957, the government created facade political parties, the Nationalist (Mellioun) Party, headed by Manochehr Eqbal, then prime minister, and the People's (Mardom) Party, headed by former prime minister Asadullah Alam, Neither of these parties ever attracted any popular following. In 1975, the shah ordered the formation of a single political organization, the Iran Resurgence (Rastakhiz) Party, into which were merged all existing legal parties. Three cardinal principles were cited for membership in the party: faith in Iran's constitution, loyalty to the monarchical regime, and fidelity to the "white revolution." This party, like others before it, lacked a popular base.

After the overthrow of the shah's regime in February 1979, new political parties were formed, the most powerful being the Islamic Republic Party (IRP), which took control of the Majlis. However, power was wielded primarily by the military, the president, the clerical elite, and the heads of the bonyads (autonomous financial organizations that have considerable power and were formed from the confiscated wealth of the former royal family and its cronies).

As of 2006 Iran's parliament, or Majlis, is made up of various groups representing a spectrum of views ranging from hard-line radical Islam to moderates and liberals. Moderates generally hold less hostile views about the West while still believing in an Islamic republic. In 1997, a moderate politician, Mohammad Khatami, was elected president of Iran. The moderates scored a further triumph in the parliamentary elections of February and May 2000. A moderate reformist coalition headed by Khatami won 189 out of 290 seats in the Majlis, with radical Islamists winning 54, independents 42, and religious minority parties 5. The following organizations had success at the 2000 parliamentary elections: Assembly of the Followers of the Imam's Line, Freethinkers' Front, Islamic Iran Participation Front, Moderation and Development Party, Servants of Construction Party, and the Society of Self-sacrificing Devotees. Khatami was reelected president in 2001 after receiving just under 77% of the vote.

In 2004, the hard-line Guardian Council banned 3,605 reformist candidates out of a total 8,157 candidates running for parliament. About 80 of the candidates were sitting members of parliament. The first round of elections was held on 20 February 2004. Reformists who chose to contest the election took only about 20% of the seats decided in the first round. The conservative win was consolidated in the second round of voting in May. Conservatives held 190 seats, reformers took 50, independents, 43; religious minorities, 5; and 2 seats were vacant as of 2005. The next legislative election was scheduled for February 2008.

LOCAL GOVERNMENT

Iran is divided into 28 ostans (provinces), each headed by a governor-general; the governor-general and district officials of each province are appointed by the central government. The ostans are subdivided into sharestans (counties), which are in turn divided into bakhsh (districts). Each bakhsh consists of two or more dehistans, which are composed of groups of villages or hamlets. Each of the municipalities (shahrdarys ) is headed by a mayor. Some sharestan officials are elected; others are appointed by Tehrān.

JUDICIAL SYSTEM

The overthrow of the shah and the approval in 1980 of a constitution making Iran an Islamic state have radically changed Iran's judicial system. The 1980 constitution was revised in 1989.

In August 1982, the supreme court invalidated all previous laws that did not conform with the dictates of Islam, and all courts set up before the 1979 revolution were abolished in October 1982. An Islamic system of punishment, introduced in 1983, included flogging, stoning, and amputation for various crimes. There are two different court systems: civil courts and revolutionary courts.

The judicial system is under the authority of the religious leader (faqih ). A supreme judicial council responsible to the faqih oversees the State Supreme Court, which has 33 branches. The chief justice of the Supreme Court is appointed by the faqih to a five-year term and must be a Muslim cleric and judicial expert. The Ministry of Justice oversees law courts in the provinces.

The revolutionary courts try cases involving national security, political offenses, narcotics trafficking, and "crimes against God." Although the constitution guarantees a fair trial, the revolutionary courts provide almost no procedural safeguards. The trials in revolutionary courts are rarely held in public and there is no guarantee of access to an attorney.

A Special Clerical Court deals with crimes committed by members of the clergy, including what can be termed ideological offenses, such as issues like interpretations of religious dogma deemed not acceptable to the establishment clergy.

Elements of the prerevolutionary judicial system continue to be applied in common criminal and civil cases. In these cases the right to a public trial and the benefit of counsel are generally respected. In 1995 the government began implementing a law authorizing judges to act as prosecutor and judge in the same case.

The constitution states that "reputation, life, property, (and) dwelling(s)" are protected from trespass except as "provided by law." However, in practice, security forces do not respect these provisions.

ARMED FORCES

In 2005, the total active armed forces of Iran numbered 420,000 with 350,000 reservists. The Iranian Army had 350,000 active personnel. Their equipment included 1,613 main battle tanks, 80 light tanks, 35 reconnaissance vehicles, 610 armored infantry fighting vehicles, 640 armored personnel carriers, and more than 8,196 artillery pieces, which included over 876 multiple rocket launchers. The Air Force had active personnel numbering an estimated 52,000, including 15,000 air defense personnel. The Air Force had 281 combat capable aircraft, including 153 fighters and 102 fighter ground attack aircraft. Iran's Navy had 18,000 active personnel in 2005. Major naval units included three tactical submarines, three frigates, two corvettes, five mine warfare vessels, and more than 254 patrol/coastal craft. Iran's Islamic Revolutionary Guard Corp (Pasdaran) was estimated at over 125,000 active personnel. The land-based element was estimated at more than 100,000 active members, while the naval element had 20,000 active personnel, including a 5,000-member Marine force. In addition, there was also an Air Force element. Although there was no data as to how many active personnel comprised that force, it was responsible for controlling Iran's strategic missile force, which consisted of one brigade and one battalion. Iran's paramilitary forces had 40,000 active members, which included security troops and border guards. There was also a reserve of the Popular Mobilization Army (Basij Resistance Force), which upon mobilization, could reach up to one million combat capable personnel. As of 2006, it was widely believed that Iran was developing the capability to produce nuclear weapons. The official military budget in 2000 (the latest year for which data was available) was $9.7 billion or 3.1% of GDP.

INTERNATIONAL COOPERATION

Iran is a charter member of the United Nations, having joined on 24 October 1945, and belongs to ESCAP and several nonregional specialized agencies, such as the FAO, UNESCO, UNIDO, the World Bank, and WHO. Iran is also a member of the Organization of the Islamic Conference (OIC), G-24, G-77 and the Colombo Plan. It is a founding member of OPEC and a leading supporter of higher petroleum prices. Iran is one of ten members in the Economic Cooperation Organization (ECO).

Iran's revolutionary government has aligned itself with the radical Arab states of Libya and Syria, which were the only Arab countries to support Iran in its war with Iraq (1980–88). Since before 1979, Iranian foreign policy has been to curtail superpower influence in the Persian Gulf area. It also encourages the Islamization of the governments throughout the Middle East, in such countries as Sudan, Algeria, Bahrain, and Saudi Arabia. Th is policy of Islamization includes strong anti-US and anti-Israeli sentiments. Despite past troubles with Iraq, Iran remained neutral during the 2003 US-led coalition invasion of Iraq, which resulted in the ousting of the Hussein government. Iran is considered to be a state sponsor of terrorism by the United States. Iran is part of the Nonaligned Movement.

In environmental cooperation, Iran is part of the Basel Convention, the Convention on Biological Diversity, Ramsar, CITES, the London Convention, the Montréal Protocol, the Nuclear Test Ban Treaty, and the UN Conventions on Climate Change and Desertification.

ECONOMY

A country with a substantial economic potential, Iran witnessed rapid economic growth during the reign of Shah Muhammad Reza Pahlavi. Development of its extensive agricultural, mineral, and power resources was financed through oil revenues. The traditional land tenure system, under which farmers were sharecroppers, was replaced through a land reform program inaugurated in 1962. In addition to carpets, Iran produced a variety of consumer goods and building materials. Oil, however, became the lifeblood of the economy. With the astonishing growth of its oil revenues, Iran became a major world economic power, whose investments helped several industrialized countries pay for their oil needs during the 1970s.

The economy changed drastically after 1979. The war with Iraq, which curtailed oil exports, coupled with the decrease in the price of oil, especially in 1986, sent oil revenues spiraling downward from $20.5 billion in 1979 to an estimated $5.3 billion in 1986. This forced annual GDP growth down from 15.2% in 1982 to 0.2% in 1984; GDP was estimated to have fallen by 8% in 1986. The war's drain on the state budget, the drop in oil prices, poor economic management, declining agricultural output, an estimated 1987 inflation rate of 30–50%, and large budget deficits combined to put enormous strains on the economy.

After Iran accepted a UN cease-fire resolution in 1988, it began reforming the economy with the implementation of the Islamic republic's first five-year social and economic development plan for 1989–94. The plan emphasized revitalizing market mechanisms, deregulating the economy, and rebuilding basic infrastructure. These reforms led to economic growth and lowered budget deficits. GDP grew an average 7% a year in real terms over 1989–92. The general government deficit was reduced from 9% of GDP in 1988 to an estimated 2% in 1992. The inflation rate decreased from 29% in 1988 to around 10% in 1990, but had redoubled to 20% in 1991–92.

Other impacts of the first plan included a growth in agricultural production of 5.6%; industrial production of 15%; water, gas and electricity of 18.9%; and transport of 11.9%. In 1991, the government adopted a structural adjustment program similar in nature to the kind the IMF imposes on developing nations in exchange for aid. Iran, however, did not need aid, but rather imposed the adjustments on itself in an effort to liberalize its economy, making it more market-oriented while still retaining an authoritarian regime. The structural adjustments advocated by then-president Rafsanjani included privatizations of state-owned enterprises, deregulation, cutting government subsidies, and encouraging foreign investment. While marginally well-intentioned, the Rafsanjani reforms led to little economic improvement. Privatization was especially ineffective. Political corruption and rampant cronyism led to many enterprises ending up in the hands of a small clique of well-connected elites. By 1997, 86% of Iran's GDP came from state-owned businesses. Deregulation also hit considerable snags. In 1996 alone, more than 250 regulations on imports and exports were issued by 24 ministries—many of them repetitive or contradictory.

In April 1995, the United States imposed trade and investment sanctions against Iran, in reprisal for what the United States believed was Iran's continued support of international terrorism. This move, unduplicated even by the strongest allies of the United States, had some economic impact—most notably a precipitous drop in the value of the rial, which the government was forced to prop up.

The GDP growth rate stood at 5.28% in 2000, 5.82% in 2001, 7.64% in 2002, and 6.1% in 2003. For 2005 and 2006, real GDP growth was expected to average 5.6% and 4.8%, respectively. GDP on average grew at a rate of 5.6% over the 2001–05 period. Inflation averaged 14.6% from 2001–05. The unemployment rate stood at 11.2% in 2004, but it is significantly higher among young people. The Iranian economy in the mid-2000s remained determined by its reliance upon oil, and continued to pass through periods of boom and bust as oil prices rose and fell on the volatile international markets. The state remained the dominant economic actor, as it was the recipient of crude oil revenue. The oil sector's share of GDP declined from 30–40% in the 1970s to 10–20%, particularly as a result of war damage to production facilities and OPEC output ceilings. Nevertheless, oil revenue provides about 80% of export earnings and some 40–50% of government revenue; therefore, the hydrocarbons sector receives the vast majority of domestic and foreign investment flows. The services sector has grown, but bureaucracy, the uncertainty of long-term economic planning, and currency-exchange restrictions have made services a volatile sector. The agricultural sector has been aided by state investment, with the improvement of packaging and marketing helping to develop new export markets. Export-based agricultural products—such as dates, flowers, and pistachios—have seen substantial growth, aided by large-scale irrigation projects, although successive years of serious drought in 1999–2001 put a damper on growth in the agricultural sector. In 2005, agriculture accounted for 11.8% of GDP, with industry contributing 43.3% and services 44.9%. As of 2001, 30% of the labor force was engaged in agriculture, with 25% in industry and 45% in services.

INCOME

The US Central Intelligence Agency (CIA) reported that in 2001 Iran's gross domestic product (GDP) was estimated at $456 billion. The per capita GDP was estimated at $7,000. The annual growth rate of GDP was estimated at 5%. The average inflation rate in 2005 was 17.3%. The CIA defines GDP as the value of all final goods and services produced within a nation in a given year and computed on the basis of purchasing power parity (PPP) rather than value as measured on the basis of the rate of exchange. It was estimated that agriculture accounted for 19% of GDP, industry 26%, and services 55%.

According to the United Nations, in 2000 remittances from citizens working abroad totaled $320 million. Worker remittances in 2001 totaled $326.4 million. Foreign aid receipts amounted to about $2 per capita.

The World Bank reported that in 2001 per capita household consumption (in constant 1995 US dollars) was $964. Household consumption includes expenditures of individuals, households, and nongovernmental organizations on goods and services, excluding purchases of dwellings. It was estimated that for the same period private consumption grew at an annual rate of 5%. Approximately 20% of household consumption was spent on food, 32% on fuel, 12% on health care, and 8% on education. It was estimated that in 1996 about 53% of the population had incomes below the poverty line.

LABOR

Iran's labor force was estimated at 23.7 million in 2005. In 2001 (the latest year for which data was available), an estimated 30% of the employed workforce was in agriculture, 25% was in industry, and 45% was in the service industry. As of 2004, unemployment was estimated at 11.2%.

The labor code grants workers the right to form and join their own organizations, however, the government-controlled Workers' House is the only authorized national labor organization. The Workers' House controls all workers according to government objectives. Strikes are not permitted. Islamic principles and dress are strictly observed at work with transgressions subjecting the worker to penalties. Workers cannot bargain collectively.

The Labor Law forbids employment of minors under 15 years of age, but these regulations are not enforced. Forced and bonded labor by children remains a serious problem. In 1997, the minimum wage was $2.80 per day. Many middle class citizens work several jobs to support their families. The Labor Code stipulates a 6-day, 48-hour workweek, with one rest day.

AGRICULTURE

Of Iran's total area, 11% is cultivated, 27% consists of permanent pastures, and 7% is forest and woodland. The remaining 55% consists of wasteland, lakes, mountains, desert, and urban areas. About one-third of the labor force is employed in agriculture. In 2003, the total land area under cultivation was estimated at 18.2 million hectares (44.9 million acres).

Progress in Iranian agriculture was greatly stimulated by the land reform of 1962–63, under which 4,025,680 farmers and their family members had taken title to their land by 1975, after the old land tenure system was abolished. However, with a rapidly increasing population and a sharply rising standard of living, Iran is no longer self-suffi cient in its agricultural production, and food imports have risen steadily.

In 2004, Iranian agricultural production (in thousands of tons) included wheat, 14,000; sugar beets, 6,050; barley, 2,700; rice, 3,400; grapes, 2,800; apples, 2,400; oranges, 1,900; dates, 880; cotton, 105; tea, 52; and tobacco, 21. Almonds and pistachios are grown primarily for export. In 2004, Iran was the largest producer of pistachios in the world (275,000 tons, or 50% of global production), and the fifth-largest producer of almonds (after the United States, Syria, Spain, and Italy), at 80,000 tons.

As of 2003, some 7.65 million hectares (18.9 million acres) were under irrigation. The fifth development plan (1973–78) envisaged an overall increase of 5.5% in agricultural production, but the revised plan raised the target to 8% annually, rescheduled allocations over six years instead of five, and slowed down the projects. Under the revolutionary government's first five-year plan (1983–88), agriculture was to receive 15.5% of total allocations, with food self-sufficiency the primary objective. However, because of the war with Iraq, planned expenditures were never attained. Moreover, food self-suffi ciency still remains only a goal: imports of agricultural products exceeded exports by nearly $1.3 billion in 2004.

ANIMAL HUSBANDRY

Not only is animal husbandry the major occupation of nomadic and seminomadic tribes scattered over Iran, but each farming village also keeps flocks that graze on the less productive areas. In 2005 there were 54,000,000 sheep, 26,500,000 goats, 8,800,000 head of cattle, 550,000 water buffalo, 146,000 camels, and 280,000,000 chickens. Cattle are raised as draft animals and for milk and are not fattened for beef. Sheep produce many staple items: milk and butter, animal fat for cooking, meat, wool for carpet making, and skins and hides. During 2002–04, livestock production was up 2.1% from 1999–2001, and up 32% from 1992–94.

FISHING

The Caspian Sea provides a seemingly inexhaustible source of sturgeon, salmon, and other species of fish, some of which spawn in the chilly streams that flow into this sea from the high Elburz Mountains. In 2003, the total fish catch was 440,835 tons. Caviar of unrivaled quality is produced by the Iranian Fisheries Co., formerly a joint Russo-Iranian venture but now wholly owned by the government of Iran. About 200,000 kg (440,000 lbs) of caviar are sold per year, most of which is exported, providing a substantial share of the world's supply. Exports of fish products in 2003 amounted to nearly $80.5 million. The fishing grounds of the Persian Gulf were long neglected, but during the 1970s new fishing fleets and packing and conserving facilities were established. The Iran-Iraq war and consequent environmental damage retarded the development of fisheries in this region. Total marine catch has more than doubled from 1982–84 levels.

FORESTRY

About 7.3 million hectares (18 million acres) were covered by forest in 2000. An estimated 844,000 cu m (30 million cu ft) of roundwood were produced in 2003; about 29% was used for fuel. Along the northern slopes of the Elburz Mountains from near sea level to an altitude of about 2,100 m (7,000 ft) are dense stands of oak, ash, elm, beech, ironwood, cypress, walnut, and a number of other varieties. The high plateau forests of Fars, Kurdistan, Luristan, and Khorasan comprise sparse stands of scrub oak, ash, maple, cedar, wild almond, and pistachio. Date palms, acacias, and tamarisks grow in the Persian Gulf area. The deciduous forests on the Caspian littoral are among the best in the world. The timber industry is controlled by the government; its potential annual capacity is 3 million cu m (106 million cu ft). In 2000, forest plantations covered 2,284,000 hectares (5,643,000 acres). Imports of forest products totaled $615.7 million in 2004.

A forest ranger school was started in 1957 as an extension of the government's forest service. In 1963, a forestry college was established at Karaj, west of Tehrān, to train forestry engineers.

MINING

Iran possessed extensive and varied mineral resources and was the world's third-largest producer of gypsum. Of Iran's 2,700 mines, most were privately owned and 2,000 were active, producing 42 minerals; some 65% of the mines produced building and construction materials and 20% were stone quarries. The mining sector accounted for 24% of Iran's industrial output of $15.4 billion, and mineral and metal exports amounted to $645 million. Mineral exports included chromite, refined sulfur, lead, zinc, copper, and decorative stone. Iron, steel, and chemicals were leading export commodities. While the petroleum and petrochemicals industries were Iran's top industries in 2002, the production of cement and other construction materials ranked fourth.

Production of gypsum in 2003 (from the Semnan region, east of Tehrān) was an estimated 10.5 million tons, up from 10.38 million tons in 2002. Estimated production of iron ore and concentrate (by gross weight) in 2003 and 2002 totaled 16.1 million tons and 11.3 million tons, respectively. Copper concentrate (29–35% Cu) output by gross weight in 2003 totaled 389,790 metric tons. Bauxite production (gross weight) totaled an estimated 450,000 metric tons in 2003, while output of mined chromite concentrate (by gross weight) in that same year was estimated at 500,000 metric tons. Lead concentrate production by gross weight in 2003 was estimated at 16,000 metric tons. Output of mined zinc concentrate by gross weight in 2003 was estimated at 240,000 metric tons, while manganese mine production by gross weight that same year was estimated at 4,300 metric tons. Mined molybdenum concentrate output by gross weight was estimated at 125,000 metric tons in 2003. Total sulfur output in 2003 was estimated at 1,360,000 metric tons. Marble production (blocks, crushed, and slabs) was estimated at 7.7 million tons in 2003.

Iran also produced orpiment and realgar arsenic concentrates, gold, silver, asbestos, barite, borax, hydraulic cement, clays (bentonite, industrial, and kaolin), diatomite, feldspar, fluorspar, turquoise, industrial or glass sand (quartzite and silica), lime, magnesite, nitrogen (of ammonia and urea), perlite, natural ocher and iron oxide mineral pigments, pumice and related volcanic materials, salt, caustic soda, stone (including granite, marble, travertine, dolomite, and limestone), celestite strontium, natural sulfates (aluminum potassium sulfate and sodium sulfate), and talc. Iran also may have produced ferromanganese, ferromolybdenum, nepheline syenite, phosphate rock, selenium, shell, vermiculite, and zeolite, and had the capacity to mine onyx.

In 2000, the government merged the Ministry of Mines and Metals and the Ministry of Industry to form the Ministry of Industry and Mines. For its third five-year economic development plan (2000–05), the government proposed to privatize 40 mineral industry companies affiliated with the Ministry of Industry and Mines, having already divested itself of numerous smaller mineral enterprises. Since 1998, the government has allowed foreign investment in solid mineral exploration joint ventures, and, in 1999, showcased 102 mining and mineral-processing projects at the First International Mines and Metals Investment Forum. The Iranian constitution prohibited foreign control over natural resources. To diversify and expand the economy in the wake of declining oil prices in the late 1990s, the government sought to increase metal production.

ENERGY AND POWER

Iran's proven oil reserves as of 1 January 2005 were estimated by the Oil and Gas Journal at 125.8 billion barrels, up from 89.7 billion barrels as of 1 January 2003; these constituted 10% of the world's known reserves, and were exceeded only by those of Saudi Arabia, Iraq, the United Arab Emirates, and Kuwait. However, in July 2004, Iran's oil minister placed the country's proven oil reserves at 132 billion barrels after discoveries in Khuzestan province's Hosseineih and Kushk fields. In 2004, Iran produced around 4.1 million barrels of oil per day, of which crude oil accounted for 3.9 million barrels per day. Domestic oil demand in 2002 was placed at an estimated 1.4 million barrels per day, with oil exports estimated for 2004 at 2.5 million barrels per day.

More than half of Iran's 40 producing fields contain over 1 billion barrels of oil. Most of the reserves are located in onshore fields in the Khuzestan region. The onshore Ahwaz, Marun, Gachsaran, Agha Jari, Bibi Hakimeh, and Pars fields alone account for half of annual oil production. In 1999 Iran announced its largest oil discovery in 30 years, at the Azadegan field in Khuzestan. It is thought to have reserves totaling as much as 24 billion barrels. Oil revenues rose from $5.1 billion in 1986 to an estimated $16.4 billion in 2002, when they accounted for about 90% of total export revenues.

In 2004, Iran's natural gas reserves were estimated at 26.7 trillion cu m, and are exceeded only by those in Russia. However, approximately 62% of Iran's natural gas reserves are situated in nonassociated fields and have yet to be developed. Iran's output in 2003 was estimated at 79 billion cu m, up from 59,400 million cu m in 2000. More than one-quarter of Iran's natural gas reserves have been discovered since 1992. Domestic demand for natural gas was estimated for 2003 at 72.4 billion cu m, with exports and imports for that year estimated at 3.4 billion cu m and 4.92 billion cu m, respectively. Exploitation of natural gas is controlled by the National Iranian Gas Co. In the mid-1990s, Iran began developing extensive gas export plans. Inside Iran, a network of pipelines connects Tehrān, Qazvin, Esfahān, Ābādān, Shirāz, and Mashhad to Ahvāz and the gas fields. In 1995, Iran played an important role in regional talks concerning the construction of a 3,200 km (2,000 mi) pipeline that would carry gas from Turkmenistan to European markets via Iran, Turkey, and possibly Ukraine. Also in 1995, Iran and Pakistan signed an agreement to ship up to 450 million cu m per day via a 1,600 km (1,000 mi) overland pipeline to Pakistan. At the end of 2001, Iran signed an agreement to build a pipeline to transmit natural gas to Azerbaijan from Khoi in the northwestern part of the country.

Although Iran is one of the world's leading oil-producing countries, Iranian industry formerly depended on other energy sources, such as electricity, coal, and charcoal. Recently, however, oil and especially gas have been used increasingly in manufacturing. In 2002, Iran's electric power generating capacity was placed at 34.222 million kW, with 31.419 million kW dedicated to conventional thermal fuel plants. Hydropower accounts for 2.803 million kW of capacity for that year. Electric power output in 2002 came to 129 billion kWh, with consumption that year at 119.9 billion kWh. Iran plans to construct ten nuclear power plants by 2015 in order to provide about 20% of the country's power needs. As of 2000, there were five small nuclear reactors in operation.

INDUSTRY

Principal industries are oil refining, petrochemicals, steel, and copper. In 1987, there were six primary refineries—at Ābādān, Bakhtaran, Tehrān, Shirāz, Esfahān, and Tabriz—with a potential capacity of 950,000 barrels per day. In late 1980, Iraqi bombing forced the closure of the Ābādān refinery, which had a total capacity of 600,000 barrels per day and was one of the world's largest refineries. Several other refineries suffered lesser damage during the war. The Kharg Island oil terminal also was severely damaged by bombing in 1985. Construction by a Japanese consortium of a $4-billion petrochemical complex at Bandar-e Khomeini, near the Iraqi border, was halted by the war; by mid-1983, the installation, which was 85% complete, had already been attacked six times. In September 1984, the Japanese withdrew their technicians from the site because of renewed Iraqi bombing. Iran took on much of the financial responsibility for the plant, and the ending of all payments of Japanese credits and loans in February 1986 meant that the plant would never be completed according to the original plans. After the cease-fire in 1988, Iran began to rebuild its damaged oil export facilities, concentrating mainly on the rehabilitation of Kharg Island. A 500,000-barrel reservoir terminal at Uhang Island was put into operation in March 1993. The oil complex on the southern island of Lavan was reopened after reconstruction at the end of April 1993. The Ābādān refinery became operational again at 200,000 barrels per day in May 1993. Esfahān's oil production unit became operational in 1992/93, while the construction of a new refinery at Bandar-e 'Abbās was underway. Major refinery products are motor fuel, distillate fuel oil, and residual fuel oil. Oil refining manufacturers had a combined capacity of 1.47 million barrels per day in 2000.

In 2005, Iran had proven oil reserves of 125.8 billion barrels. Oil production that year was 4.3 million barrels per day, of which 93% was crude oil. In 2005, Iran had estimated net exports of 2.7 million barrels of oil per day, the second-largest exporter in the Persian Gulf region. The Doroud 1 & 2, Salman, Abuzar, Foroozan, and Sirri fields comprise the bulk of Iran's offshore output, all of which is exported. Iran planned extensive development of existing offshore fields, and hoped to raise its offshore production capacity to 1.1 million barrels per day, from 675,000 barrels per day in 2004. Iran's major refineries in 2005 were at Ābādān, Esfahān, Bandar Abbas, Tehrān, Arāk, Tabriz, Shirāz, Kermānshāh, and Lavan Island.

The natural gas industry has boomed in Iran, with the second-largest proven reserves in the world (940 trillion cubic feet in 2005). In 2005, Iran produced 2.8 trillion cubic feet of natural gas. In October 2004, Iran and China announced the signing of a deal for Chinese investment in Iran's oil fields and the long-term sale of Iranian natural gas to China, which could eventually be worth $100 billion. The gas agreement entailed the annual export of some 10 million tons of Iranian liquefied natural gas (LNG) for a 25-year period. The agreement could eventually reach 15–20 million tons a year, taking the total value to as much as $200 billion. Iran must first build the plants to liquefy the natural gas. This agreement was seen as a blow to US sanctions on Iran. The Iran-Libya Sanctions Act (ILSA), first enacted in 1995, penalizes companies investing more than $20 million in Iran's oil and gas sector; it was renewed in 2001 for five years. Iran hoped the gas deal with China would encourage other countries (such as Japan,India, Russia, and European countries) to reconsider doing business with Iran.

A plant in Ābādān for the production of plastics, detergents, and caustic soda was completed in the 1960s. Since then, the petrochemical industry has expanded considerably: by the mid-2000s, Iran's attempt to diversify its economy resulted in its investing some of its oil revenue in the petrochemicals sector and other areas. Petrochemicals has been the main element of the postwar industrialization program. The heavy metals industry began in 1972 with the start of steel production at Esfahān National Steel Mill in Esfahān. Manufactured goods include diesel engines, motor vehicles, television sets, refrigerators, washing machines, and other consumer items.

The textile industry has prospered in recent years with increased production of cotton, woolen, and synthetic fabrics. The making of handwoven carpets is a traditional industry in Iran that flourishes despite acute competition from machine-made products. However, carpet exports declined throughout the war years. To promote self-suffi ciency, Iran has encouraged development of the food-processing, shoemaking, paper and paper products, rubber, pharmaceutical, aircraft, and shipbuilding industries. Other industrial products include cement, nitrogenous fertilizer, phosphate fertilizers, and refined sugar.

Iran's industrialization program was set back by political turmoil and labor disruptions of the late 1970s and by the revolutionary government's nationalization of industries in the summer of 1979, causing a flight of capital and trained managers. However, the sector recovered somewhat by 1983/84, when the government reported a 23% gain in industrial production.

The development plan of 1989–94 increased funding to develop heavy industry. A privatization decree in June 1991 led to the identification of 390 public manufacturing and trading firms for divestiture; of these, 185 were already been divested. Industrial production grew at a rate of 5.3% during 1988–98, as opposed to a–3.4% rate during the 1970s. The industrial production growth rate stood at 3% in 2005 (excluding oil). Market reforms were set to continue after 2000, but were placed in question when a conservative parliament was elected in May 2004 and a conservative president, Mahmoud Ahmadinejad, in June 2005.

SCIENCE AND TECHNOLOGY

The "white revolution" of the 1960s, which emphasized industrialization, involved the importation of petroleum technology and the training of Iranian technicians abroad, but it did not improve Iran's indigenous technology. The principal scientific institution in Tehrān is the International Scientific Research Institute, founded in 1955. Specialized learning societies include the Iranian Mathematical Society and the Iranian Society of Microbiology, both headquartered in Tehrān. Also in the city are the Animal Husbandry Research Institute and the Institut Pasteur. Iran has 37 universities offering degrees in basic and applied sciences. Following the removal of the shah and the formation of an Islamic revolutionary government, Iran suffered a "brain drain" as foreigntrained scientists and engineers either fled the country or refused to return after their education. In 1987–97, science and engineering students accounted for 37% of college and university enrollments. As of 2001, there were 484 researchers and 390 technicians per million people. High technology exports in 2002 were valued at $64 million, or 3% of GDP.

DOMESTIC TRADE

Outside the major cities, most goods are sold in small shops or open-air markets. Most large enterprises are controlled by the state. Privately owned shops for trade and services are typically small. Textile industries are located in Esfahān and Shirāz. Kermān is known for production and distribution of fine carpets. Hamadān is an important trade center for agricultural products from the surrounding areas.

Business hours are from 8 am to 2 pm, Saturdays through Wednesdays. Since Friday is the official Muslim holy day, many establishments close early on Th ursday afternoons or are completely closed on Thursdays. Banking hours are 7:30 am to 2 pm on weekdays and 7:30am to 12 pm on Thursdays. Shops are open from 10 am to 9 pm, Saturdays through Thursdays, and department stores are open until 9:30 pm.

FOREIGN TRADE

In 2005, major imports included machinery, military supplies, metal works, food, pharmaceuticals, technical services, and refined oil products.

Iran's most expensive export is crude petroleum, which accounts for the majority of its commodity exports revenues (80%). Petrochemicals made up 4.1% of merchandise exports in 2004. Other exports included floor coverings and fruits and nuts, with pistachios accounting for 2.4% of merchandise exports in 2004. Iran accounts for 10% of the world's carpet exports.

Iran's leading markets in 2004 were Japan (18.5% of total exports); China (9.6%); and Italy (6%). Iran's leading suppliers in 2004 were Germany (12.3% of total imports); France (8.4%); and China (7.5%).

BALANCE OF PAYMENTS

Throughout the 1960s and 1970s, Iran had a favorable trade balance, but substantial imports of services resulted in an annual deficit on current accounts. Long-term capital inflows from private sources reached a peak in 1965; between 1968 and 1973, capital

from foreign governments played a prime role in Iranian development. By 1974, with a net trade surplus of $17.7 billion and a current account surplus of $10.9 billion, Iran was one of the world's major exporters of capital. The current accounts balance remained in surplus annually until the massive economic and civic turbulence caused by the revolution of 1979 and the long, devastating war with Iraq (1980–88). By the time the war had ended, Iran's position as a net foreign creditor was badly eroded due to a substantial drop in the world price for oil and a sharp increase in dependence on imports—largely machinery and basic commodities to rebuild infrastructure. By 1993, Iran owed foreign creditors nearly $30 billion. In following years, the government, still plagued by lessening oil revenues and a quota of production imposed on it by OPEC, was forced to reschedule the debt—with payments coming due in 1996, when foreign debt went down to approximately $22 billion. Foreign debt stood at approximately $8.2 billion in 2002.

High oil prices during 2000–04 allowed Iran to record substantial trade surpluses, even though import spending also rose quickly as strong foreign-exchange earnings and the easing of the country's debt-repayment schedule allowed the central bank to relax its import compression program. In 2005, Iran had exports of $55.42 billion, and imports of $42.5 billion. The current-account surplus was $8.179 billion. Foreign debt stood at $16.94 billion. Iran had $40.06 billion in foreign exchange reserves and gold.

BANKING AND SECURITIES

The Iranian fiscal year begins on 21 March and runs through 20 March of the following calendar year. Before the modern era in Iranian banking, which dates to the opening of a branch of a British bank in 1888, credit was available only at high rates from noninstitutional lenders such as relatives, friends, wealthy land-owners, and bazaar money lenders. As recently as 1988 these noninstitutional sources of credit were still available, particularly in the more isolated rural communities. The Central Bank of Iran-Bank Markazi, established by the Monetary and Banking Law of 1960, issues notes, controls foreign exchange, and supervises the banking sector.

The revolutionary government nationalized all commercial banks shortly after taking office in 1979 and announced that banking practices would be brought in line with Islamic principles, which include a ban on interest payments. By 1993 there were five Islamic banks, which had incorporated the previous banks. Instead of paying interest, the new banks give "guaranteed returns" or commissions on loans. The commissions, which equal 4% of the loan's total, were introduced in 1984, and were known as "profit sharing." In Islamic terms, this meant that profit (interest) was acceptable only if a lender's money was "not at risk."

In 1991 measures to promote competition between banks, and to loosen Bank Markazi's control in order to encourage savings within the official banking sector were introduced. In 1994 Bank Markazi introduced reforms allowing private banking operations to register officially and offer most services in competition with the public sector. However, the raft of new currency and export regulations that followed the collapse of the rial in April 1995 put the recently legalized private sector under huge pressure because, for many of the bazaar traders, currency dealings represented a significant share of their total business. There is a basic lack of confidence in the banking system. Many informal banking operations are run from the bazaars. In addition, Iranians who are able to do so operate bank accounts outside the country, importing funds as needed rather than using the domestic system.

Bank Melli, which has acted for the central bank, handles most Iranian banking operations outside the country. The requirements to abide by Islamic principles were never imposed on Bank Melli. The International Monetary Fund reported that in 2001, currency and demand deposits—an aggregate commonly known as M1—were equal to $71.7 billion. In that same year, M2—an aggregate equal to M1 plus savings deposits, small time deposits, and money market mutual funds—was $153.6 billion.

The Tehrān Stock Exchange, locally known as the Bourse, was created in 1968. Three years later, the National Bank of Iran and the Industrial and Mining Development Bank of Iran joined with the US firm of Merrill Lynch, Pierce, Fenner and Smith to begin international brokerage activities in Iran. The exchange has stayed open since the revolution but did not play a significant role in the nation's business until the 1990s. Since 1989, the stock exchange has expanded continuously. A total of 344 companies were being traded and the capitalization of the exchange was reported to be nearly $26 billion in mid-2003.

INSURANCE

The insurance industry had a negligible role in the accumulation of funds to finance development, largely because insurance was not used by most of the population; the insurance industry in Iran had barely started in 1960. On 25 June 1979, the revolutionary government announced the nationalization of all insurance companies. Under a 1971 Act of parliament, all companies operating in Iran were required to cede 25% of total acquired nonlife business and 50% of life business to Bimeh Markazi Iran, the central insurance company of Iran. The company writes all classes of insurance and reinsurance. In 2003, the value of all direct premiums written totaled $1.484 billion, of which nonlife premiums accounted for $1.368 billion. As of 2005, there was no further published data on premium income in Iran.

PUBLIC FINANCE

Iran's fiscal year coincides with its calendar year, beginning on 21 March. The budget is prepared by the Finance Ministry and submitted to parliament. Trade reforms implemented since 1991 have boosted economic growth and reduced budget deficits. The general government deficit fell from 9% of GDP in 1988 to 2% in 1992, but was up to almost 7% again in 1998. By 2002, however, external debt was equivalent to less than 2% of GDP as a result of market reforms.

The US Central Intelligence Agency (CIA) estimated that in 2005 Iran's central government took in revenues of approximately $48.8 billion and had expenditures of $60.4 billion. Revenues minus expenditures totaled approximately -$11.5 billion. Public debt in 2005 amounted to 27.5% of GDP. Total external debt was $16.94 billion.

The International Monetary Fund (IMF) reported that in 2004, the most recent year for which it had data, central government revenues were r408,094 billion and expenditures were r383,011 billion. The value of revenues in US dollars was us$47 million and expenditures us$44 million, based on a official exchange rate for 2004 of us$1 = r8,614 as reported by the IMF. Government outlays by function were as follows: general public services, 11.1%; defense, 9.3%; public order and safety, 3.7%; economic affairs, 25.8%; environmental protection, 0.6%; housing and community amenities, 7.5%; health, 6.2%; recreation, culture, and religion, 5.0%; education, 8.2%; and social protection, 22.6%.

TAXATION

Under tax laws written in May of 1992, individual income is taxed at rates varying from 12–54%. Capital gains and investment income are also taxable and employees pay a 7% social security contribution. As of 2005, corporate profits were taxed at 25%, although

companies listed on the Tehrān Stock Exchange were taxed at a 22.5% rate. Income derived from outbound international transport was taxed at 5%. Capital gains resulting from the transfer of real property were taxed at 5% of the value of the property according to regional value tables. Capital gains resulting from the sale of securities listed on the Tehrān Stock Exchange were taxed on 0.5% of the sales value. Also levied are real estate taxes, municipal taxes, and a levy on expatriate salaries. A value-added tax (VAT) or sales tax of 3% is applied to products considered final. Another tax is a public education cost levy to be paid by manufacturing and service companies.

CUSTOMS AND DUTIES

Most goods entering Iran are subject to customs duties, the majority of which are on the CIF (cost, insurance, and freight) value. A number of government organizations and charitable institutions are permitted to import goods free of duty. The average tariff was 4% in 2005, down from 18.9% in 2000.

FOREIGN INVESTMENT

Until the early 1970s, Iran rarely participated in foreign businesses. The National Iranian Oil Company (NIOC) invested in the construction of oil refineries in Madras, India, and other places and participated in several ventures with foreign oil firms that held concessions for Iranian oil. With the vast increase in oil revenues, Iran became one of the world's leading creditor nations; in 1974 alone, bilateral agreements worth hundreds of billions of rials were signed with France, Germany, Italy, and the United Kingdom. In July 1974, Iran agreed to purchase a 25% interest in the German steel-making firm of Krupp Hüttenwerke, an investment believed to be the largest single stake purchased by any oil-producing nation in a major European firm up to that time. In 1975, Iran began negotiating investments through the United Nations Development Programme (UNDP) in developing nations.

Prior to World War II, foreign companies had important investments in Iranian banks, insurance companies, transport, and the oil industry. In 1955, the legislature enacted a law providing for withdrawal of invested capital in the currency that was brought into Iran, for the export of annual profits, and for adequate compensation in the event of nationalization of the industry or business. In 1957, the United States and Iran exchanged notes recognizing that the United States would guarantee its private investments in Iran against loss through actions by Iran, and the following year the Majlis enacted a law protecting foreign capital investments. Foreign companies moved into Iran to exploit mineral resources, to establish banks in partnership with Iranian capital, to build factories, and to carry out segments of the shah's vast economic development program.

Since 1979, the instability of the revolutionary government and the catastrophic war with Iraq have had a chilling effect on Western investment in Iran. In 1995, the United States imposed trade and investment sanctions on Iran for its support of international terrorism; the Iran-Libya Sanctions Act (ILSA) penalizes companies investing more than $20 million in Iran's oil and gas sector; the ILSA was renewed in 2001 for five more years. The country emerged from the war with Iraq in terrible economic shape. In 1995, desperate for Western assistance in rebuilding its oil sector, Iran contracted with the French Oil Company, Total, to develop its Sirri oil field. It was the first instance of foreign investment in the vital petroleum sector since the 1979 revolution. In 1995, Iran had negative direct foreign investment of about $50 million, reflecting repatriation of profits greater than inflows of new investment.

Inward foreign investment outside the oil and gas sectors in the fiscal year ending in March 2005 was a mere $1 billion. Some large investment deals have made their way through the system, however, and the oil minister in 2005 called for $150 billion of new investment to double petroleum production. Foreigners observe investment in Iran warily, although Iran hopes to attract billions of dollars worth of foreign investment by creating a favorable investment climate (by reducing restrictions and duties on imports and creating free trade zones). Additionally, disagreements between reformers and conservatives make foreign investors wary of doing business in Iran, as does the international standoff over the country's nuclear program. In September 2005, Iran threatened to impose investment limits on countries opposing its right to access nuclear fuel cycle technology.

ECONOMIC DEVELOPMENT

Iran's first development plan (1949–56) foundered because of the lack of oil revenues during the nationalization dispute and also because the IBRD refused to lend the hoped-for one-third of the projected development expenditures. The second plan (1956–63) also ran into financial diffi culties when the domestic budget consumed a larger proportion of the oil revenues than expected. An austerity program from 1960, however, facilitated economic recovery. The third plan (1963–68) was successful, and the period witnessed rapid economic growth. This plan placed emphasis not only on the building of an infrastructure but also on projects making use of local resources. The private sector exceeded the target planned for investment. Substantial foreign aid, varied in its sources, was also forthcoming, and foreign investment in Iran totaled more than $2.7 billion. The fourth plan (1968–73) was far more successful than the previous ones, with most of its objectives realized beyond expectation. The mean annual GNP growth was 11.2%, as compared with the projected figure of 9%. Similarly, per capita GNP rose to about $560 ($300 had been the goal).

In its revised form, the fifth plan (1973–78) provided for infrastructural development and other expenditures. However, a lag in oil revenues led to rescheduling of the plan for six years instead of five and the postponement or slowdown of individual projects. Because of political opposition and social unrest during the last year of the shah's reign, the plan was abandoned in 1978. The Islamic government that came to power in 1979 cut economic development funds because of a shortage of revenues, but in 1983 it proposed its own five-year development plan for 1983–88, with allocations totaling $166 billion and emphasis given to agriculture and service industries. However, the government's cutbacks on oil production (and, consequently, of the oil revenues that were to finance the plan), coupled with the diversion of resources to the war with Iraq, made it impossible to fulfill the plan's goals.

The five-year plan (1989–94) authorized up to $27 billion in foreign borrowing. It aimed to increase productivity in key industrial and economic sectors and to promote the non-oil export sector. The 1994–99 plan aimed at investing money in transport, particularly in the railroad system and in the construction of a public underground for Tehrān. Other projects were aimed at revitalizing the petroleum sector and developing the natural gas sector. The five-year plan implemented from 2000–04 was to privatize at least six major state-owned enterprises (such as communications and tobacco), and at least 2,000 smaller state-owned firms. The conservative parliament that took office in May 2004 ruled against key reforms planned for the 2005–09 economic plan. Nevertheless, Iran's five-year plans have envisaged a gradual move towards a market-oriented economy, but political and social concerns and external debt problems have hampered progress. Upon being elected president in June 2005, conservative populist Mahmoud Ahmadinejad pledged to fight poverty and corruption while creating new jobs in the public sector. He proposed sharing the nation's oil wealth more broadly and reducing the country's income gap between rich and poor. Ahmadinejad also favored the promotion, where possible, of local firms over foreign enterprises.

SOCIAL DEVELOPMENT

Traditionally, the family and the tribe were supplemented by Islamic waqf (obligatory charity) institutions for the care of the infirm and the indigent. Social welfare programs include workers' compensation, disability benefits, maternity allowances, retirement benefits, death benefits, and family and marriage allowances. These programs cover all employed persons between the ages of 18 and 65 who reside in the country. There is a special pension system in force for public employees. Old age benefits are available at age 65 for men and age 60 for women. Seasonal workers are covered for medical services during the working season. Employed persons in urban areas are covered by workers' compensation. Family allowances are available for working families with limited means.

Statistics on violence against women including spousal abuse are unavailable. Provisions in the Islamic Penal and Civil code discriminate against women, especially in property rights. The testimony of a woman in court is worth half of a man's statement. Women receive more harsh punishments for criminal offenses. A woman can only divorce a man for limited reasons, but a man may divorce his wife without cause. Gender segregation is enforced in most public places

The Jewish, Christian, and Baha'i minorities face government discrimination in education, employment, and public accommodations. They also suffer harassment and abuse. Serious human rights abuses persist, including summary execution, disappearance, torture, rape, stoning, flogging, arbitrary arrest and detention, and harsh prison conditions. The Iranian government continues to restrict freedoms of speech, assembly, religion, association, and the press.

HEALTH

Beginning in the 1960s, national campaigns against such major diseases as malaria and smallpox were undertaken. Other major health problems included high infant mortality, smallpox outbreaks, venereal disease, trachoma, typhoid fever, amoebic dysentery, malaria, tuberculosis, and the debilitating effects of smoking opium. The creation in 1964 of a health corps, consisting of physicians and high school graduates who agreed to spend the period of their military service serving in semimobile medical units in rural areas, helped to reduce the death rate. Roving health corps teams, comprising a doctor, a dentist, a pathologist, and (when possible) a nurse, served the villages, offering medical services to 10,000–15,000 rural inhabitants annually.

As of 2002, the death rate was estimated at 5.4 per 1,000 people. The infant mortality rate in 2005 was 41.58 per 1,000 live births.

The Islamic republic has continued to provide health care programs to rural areas. As of 2004, there were an estimated 105 physicians, 246 nurses, and 19 dentists per 100,000 people in Iran. Many physicians left the country after the 1979 revolution and health conditions were reportedly deteriorating; however, by the mid-1980s, many doctors who had been in exile during the shah's reign had returned. Approximately 80% of the population had access to health care services. Total health care expenditure was estimated at 4.2% of GDP. Average life expectancy in 2005 was estimated at 69.96. In 2000, 95% of the population had access to safe drinking water and 81% had adequate sanitation. Some form of contraceptive was used by 73% of married women ages 15–49 as of 2000. Iran's estimated birth rate in 2002 was 17.5 per 1,000 people. Children up to one year old were immunized against tuberculosis, 100%; diphtheria, pertussis, and tetanus, 95%; polio, 95%; and measles, 95%.

The prevalence of low birth weight babies has risen from 4% of all births in 1980 to 10% in 1999. As of 2000, 16% of all children were malnourished. Cholera was reported in 2,177 individuals. Malaria cases are high. The HIV/AIDS prevalence was 0.10 per 100 adults in 2003. As of 2004, there were approximately 31,000 people living with HIV/AIDS in the country. There were an estimated 800 deaths from AIDS in 2003.

HOUSING

Rapid urbanization and migration of refugees into the country have made housing one of the country's most acute social problems. Although housing has always been given top priority in development plans, the gap between supply and demand for dwellings has grown increasingly wide. During the fourth plan (1968–73), nearly 300,000 housing units were built, but because some 120,000 new families were added to the urban population during that period, the average density rose from 7.7 to 8.5 persons per dwelling. During the same period, the national urban housing deficit rose from 721,000 to 1.1 million units. However, housing starts fell sharply after the 1979 revolution, as construction declined precipitously because of lack of funding (construction of all buildings dropped by 21% in 1981/82 and 24% in 1982/83). In 1995–2000, the government presented programs focused on attracting private sector investment and approving legal and economic measures.

In 1986 (the latest year for which such statistics are available), 43% of all housing units were constructed of brick with iron beams, 19% were adobe and wood, 16% were brick with wooden beams, 10% were adobe and mud, 5% were cement block, and 3% were iron with a cement skeleton. Electricity was available in 84% of all housing units, 95% had a water toilet, 75% had piped water, 54% had a kitchen, and 47% had a bath. According to 1996 national statistics, there were about 12,349,003 private households in permanent dwellings. About 38,940 households were listed as "unsettled," meaning that they were either homeless or nomadic.

EDUCATION

Education is virtually free in Iran at all levels, from elementary school through university. At the university level, however, every student is required to commit to serve the government for a number of years equivalent to those spent at the university.

During the early 1970s, efforts were made to improve the educational system by updating school curricula, introducing modern textbooks, and training more efficient teachers. The 1979 revolution continued the country's emphasis on education, but Khomeini's regime put its own stamp on the process. The most important change was the Islamization of the education system. All students were segregated by sex. In 1980, the Cultural Revolution Committee was formed to oversee the institution of Islamic values in education. An arm of the committee, the Center for Textbooks (composed mainly of clerics), produced 3,000 new college-level textbooks reflecting Islamic views by 1983. Teaching materials based on Islam were introduced into the primary grades within six months of the revolution.

Education is compulsory for five years of primary school. A middle school program covers three years of study. After this stage, students may choose to continue in general academic studies or vocational studies for three years. Students interested in continuing on to university studies complete an additional year. The academic year runs from September to June.

Primary school enrollment in 2003 was estimated at about 86% of age-eligible students. Nearly all students complete their primary education. In 2001, secondary school enrollment was about 76% of age-eligible students. The student-to-teacher ratio for primary school was at about 24:1 in 2003; the ratio for secondary school was about 28:1.

The tradition of university education in Iran goes back to the early centuries of Islam. By the 20th century, however, the system had become antiquated and was remodeled along French lines. The country's 16 universities were closed after the 1979 revolution and were then reopened gradually between 1982 and 1983 under Islamic supervision. While the universities were closed, the Cultural Revolution Committee investigated professors and teachers and dismissed those who were believers in Marxism, liberalism, and other "imperialistic" ideologies. The universities reopened with Islamic curriculums.

The University of Tehrān (founded in 1934) has 10 faculties, including a department of Islamic theology. Other major universities are at Tabriz, Mashhad, Ahvāz, Shirāz, Esfahān, Kermān, Babol Sar, Rasht, and Orūmiyeh. There are about 50 colleges and 40 technological institutes. In 2003, about 21% of the tertiary age population were enrolled in some type of higher education program.

A literacy corps was established in 1963 to send educated conscripts to villages. During its first 10 years, the corps helped 2.2 million urban children and 600,000 adults become literate. The adult literacy rate for 2004 was estimated at about 77%, with 83.5% for men and 70.4% for women. As of 2003, public expenditure on education was estimated at 4.9% of GDP or 17.7% of total government expenditures.

LIBRARIES AND MUSEUMS

Public libraries and museums are fairly new in Iran. The National Library at Tehrān had a good general collection of about 590,000 volumes as of 2002. The Library of Parliament, with 170,000 volumes, has an extensive collection of manuscripts and an unrivaled collection of documentary material in Farsi, including files of all important newspapers since the inception of the press in Iran. The Central Library of the University of Tehrān holds some 650,000 volumes. In 2005, there were over 1,000 public library branches throughout the country.

Tehrān has the Archaeological Museum, overflowing with fabulous treasures from the long cultural and artistic history of Iran, and the Ethnological Museum. Iran's crown treasures—manuscripts, jeweled thrones, and a vast variety of other objects—may be seen at the Golestan Palace. Museums at Esfahān, Mashhad, Qom, and Shirāz feature antique carpets, painted pottery, illuminated manuscripts, and fine craftsmanship in wood and metal; most of these objects date from the 12th to the 18th centuries.

MEDIA

Telegraph, telephone, and radio broadcasting services are stateowned. In 1996, 25 regional telecommunications authorities were formed to oversee paging services and cellular systems. In 2003, there were an estimated 220 mainline telephones for every 1,000 people; over one million people were on a waiting list for telephone service installation. The same year, there were approximately 51 mobile phones in use for every 1,000 people.

Both radio and television were nationalized in 1980. Principal stations are located in Tehrān, and other major stations broadcast from Ahvāz, Zahedan, Tabriz, Rasht, Kermānshāh, and Bandare Lengeh. As of 1999 there were 72 AM and 6 FM radio stations and 28 television broadcast stations. Television of Iran, a privately owned station, began broadcasting in 1956 in Tehrān and Ābādān. The national radio organization and the government television network were merged in 1971 to form National Iranian Radio and Television (NIRT). After 1979, it became the Islamic Republic of Iran Broadcasting Company. Though there is an official ban on owning a satellite dishes, many still do, particularly wealthier citizens. In 2003, there were an estimated 281 radios and 173 television sets for every 1,000 people. The same year, there were 90.5 personal computers for every 1,000 people and 72 of every 1,000 people had access to the Internet. There were 13 secure Internet servers in the country in 2004.

Among Iran's most widely read newspapers are Ettela'at (2002 circulation 500,000) and Kayhan (350,000). Alik (3,400) is an Armenian daily, Journal de Teheran (8,000) is published in French, and Teheran Times (7,700) is published in English. There are also several weeklies and special interest magazines. Most print media originate in Tehrān.

The constitution does not mention freedom of speech and limits freedom of the press; a press law requires publications to be licensed, and their editors are subject to imprisonment for printing reports the religious authorities deem insulting. As of 2004, there were many reports of continuing government infringement on freedom of the press.

ORGANIZATIONS

Long renowned for their individualism, Iranians now actively associate with modern public and private organizations. Under the shah, the government greatly encouraged the growth of the cooperative movement; the first Workers' Consumers Society was established in 1948. Many villages have founded producers' cooperatives with official advice and support, and consumers' cooperatives exist among governmental employees and members of the larger industrial and service organizations. Rural cooperative societies are wide spread. The Chamber of Commerce, Industries, and Mines has its headquarters in Tehrān.

Private charitable organizations date from as early as 1923, when the Iranian Red Lion and Sun Society was established; this organization has since joined the corresponding international organization of the Red Crescent Society. Other charitable institutions include the Organization for Social Services and the Mother and Infant Protection Institute. The Islamic Women's institute is active. The Society to Combat the Use of Opium has waged a campaign against use of the drug. Human Rights Monitor is a multinational organization based in Tehrān.

For youth, the Boy Scout movement in Iran began before World War II. There are several sports associations active within the country, representing such pastimes as badminton, tennis, baseball, and track and field. There are active organizations of the Special Olympics.

TOURISM, TRAVEL, AND RECREATION

Political and civil unrest has kept many tourists from visiting Iran in recent years. Principal tourist attractions include historic and beautifully decorated mosques, mausoleums, and minarets. There are many sports and physical culture societies in Tehrān and the provinces, where the emphasis is on skiing and weight lifting. Other popular sports include football (soccer), wrestling, and volleyball.

A valid passport and visa are required to enter Iran. All travelers are required to have a certificate of inoculations against meningitis.

FAMOUS IRANIANS

The long history of Iran has witnessed many conquerors, wise rulers and statesmen, artists, poets, historians, and philosophers. In religion, there have been diverse figures. Zoroaster (Zarathushtra), who probably lived in the 6th century bc, founded the religion known as Zoroastrianism or Mazdaism, with Ahura-Mazda as the god of good. In the 3rd century ad, Mani attempted a fusion of the tenets of Mazdaism, Judaism, and Christianity. The Bab (Sayyid 'Ali Muhammad of Shirāz, 1819–50) was the precursor of Baha'ism, founded by Baha' Allah (Mirza Husayn 'Ali Nuri, 1817–92).

Persian rulers of the pre-Christian era include Cyrus ("the Great"; Kurush, r.550–529 bc), Cambyses II (Kambuiya, r.529–522 bc), Darius I ("the Great"; Darayavaush, r.521–486 bc), Xerxes I ("the Great"; Khshayarsha, r.486–465 bc), and Artaxerxes I (Artakhshathra, r.464–424 bc). Shah 'Abbas (r.1587–1628) expanded Persian territory and conquered Baghdād. Prominent political figures of modern times are Reza Shah Pahlavi (1877–1944), who reigned from 1925 to his abdication in 1941; and his son, Muhammad Reza Pahlavi (1919–80), who was shah from 1941 until his abdication in 1979. Until his death in 1989, Iran was under the leadership of Ayatollah Ruhollah Khomeini (1900–89). Ayatollah Ali Khamenei (b.1939) took over the position of Supreme Leader upon Khomeini's death.

The great epic poet Firdawsi (Abdul Qasim Hassan ibn-i-Ishaq ibn-i Sharafshah, 940–1020), writing about ad 1000, produced the Shahnama (Book of Kings) dealing with four ancient dynasties and full of romantic and heroic tales that retain their popularity today. Omar Khayyam (d.1123?), astronomer and poet, is known in the Western world for his Rubáiyât, a collection of quatrains freely translated by Edward Fitzgerald. Important figures of the Seljuk period (11th and 12th centuries) include Muhammad bin Muhammad al-Ghazali (1058–1111), philosopher and mystic theologian, who exerted an enormous influence upon all later speculative thought in Islam; Farid ad-Din 'Attar (Muhammad bin Ibrahim, 1119–1229?), one of the greatest of mystic poets; and Nizami (Nizam ad-Din Abu Muhammad, 1141–1202), noted for four romantic epic poems that were copied and recopied by hand and illuminated with splendid miniatures. In the 13th century, Jalal ad-Din Rumi (1207–73) compiled his celebrated long mystic poem, the Mathnavi, in rhyming couplets; and Sa'di (Muslih ud-Din, 1184?–1291), possibly the most renowned Iranian poet within or outside of Iran, composed his Gulistan (Rose Garden) and Bustan (Orchard). About a hundred years later, in 1389, another poet of Shirāz died, Hafiz (Shams ud-Din Muhammad); his collected works comprise nearly 700 poems, all of them ghazals or lyrical odes.

Poets of the modern period include Iraj Mirza (1880–1926), Mirzadeh Eshqi (d.1924), Parveen Ettasami (d.1941), and the poet laureate Behar (Malik ash-Shuara Bahar, d.1951). Preeminent among prose writers was Sadeq Hedayat (1903–51), author of the novel Buf i kur (The Blind Owl) and numerous other works, including films. Azar Nafisi (b.1955) is an Iranian-born professor and writer residing in the United States whose book Reading Lolita in Tehran gained international acclaim and was translated into 32 languages.

Miniature painting came to full flower in the second half of the 15th century. The greatest figure in this field was Bihzad, whose limited surviving work is highly prized. The School of Herāt was composed of his followers.

Abbas Kiarostami (b.1940) is an influential and controversial postrevolutionary filmmaker who is highly respected in the international film community.

DEPENDENCIES

Iran has no territories or colonies.

BIBLIOGRAPHY

Afary, Janet. The Iranian Constitutional Revolution, 1906–1911: Grassroots Democracy, Social Democracy, and the Origins of Feminism. New York: Columbia University Press, 1996.

Amanat, Abbas. Pivot of the Universe: Nasir al-Din Shah Qajar and the Iranian Monarchy, 1831–1896. Berkeley: University of California Press, 1997.

Amirahmadi, Hooshang. Revolution and Economic Transition: The Iranian Experience. Albany: State University of New York Press, 1990.

Amuzegar, Jahangir. Iran's Economy under the Islamic Republic. London and New York: St. Martin's, 1993.

Bina, Cyrus, and Hamid Zangeneh (eds.). Modern Capitalism and Islamic Ideology in Iran Bina and Hamid Zangeneh. New York: St. Martin's Press, 1992.

Cirincione, Joseph, Jon B. Wolfsthal, and Miriam Rajkumar. Deadly Arsenals: Nuclear, Biological, and Chemical Th reats. 2nd ed. Washington, D.C.: Carnegie Endowment for International Peace, 2005.

Daneshvar, Parviz. Revolution in Iran. New York: St. Martin's Press, 1996.

Hourani, Albert Habib. A History of the Arab Peoples. Cambridge, Mass.: Belknap Press of Harvard University Press, 2002.

Kamrava, Mehran. The Political History of Modern Iran: From Tribalism to Theocracy. Westport, Conn.: Praeger, 1992.

Karshenas, Massoud. Oil, State, and Industrialization in Iran. New York: Cambridge University Press, 1990.

Kashani-Sabet, Firoozeh. Frontier Fictions: Shaping the Iranian Nation, 1804–1946. Princeton, N.J.: Princeton University Press, 1999.

Keddie, Nikki R. Iran and the Muslim World: Resistance and Revolution. Hampshire, England: Macmillan, 1995.

Lorentz, John H. Historical Dictionary of Iran. Lanham, Md.: Scarecrow Press, 1995.

Loveday, Helen. Iran. 2nd ed. London: Hi Marketing, 1999.

Mackey, Sandra. The Iranians: Persia, Islam and the Soul of a Nation. New York: Dutton, 1996.

O'Ballance, Edgar. Islamic Fundamentalist Terrorism, 1979–95: The Iranian Connection. Washington Square N.Y.: New York University Press, 1997.

O'Sullivan, Meghan L. Shrewd Sanctions: Statecraft and State Sponsors of Terrorism. Washington, D.C.: Brookings Institution Press, 2003.

Paidar, Parvin. Women and the Political Process in Twentieth-Century Iran. Cambridge, England: Cambridge University Press, 1995.

Seddon, David (ed.). A Political and Economic Dictionary of the Middle East. Philadelphia: Routledge/Taylor and Francis, 2004.

Shaffer, Brenda. Borders and Brethren: Iran and the Challenge of

Azerbaijani Identity. Cambridge, Mass.: MIT Press, 2002.

Simpson, John. Lifting the Veil: Life in Revolutionary Iran. London: Hodder and Stoughton, 1995.

Standish, John F. Persia and the Gulf: Retrospect and Prospect. New York: St. Martin's Press, 1998.

IRAN

Islamic Republic of Iran

Jomhuri-ye Eslami-ye Iran

COUNTRY OVERVIEW

LOCATION AND SIZE.

Iran, a country slightly larger than Alaska, is located in the Middle East, bordering the Gulf of Oman and the Persian Gulf in the south and the Caspian Sea in the north. It covers an area of 1.648 million square kilometers (636,296 square miles) and is edged between Iraq, with which it shares a border of 1,458 kilometers (906 miles), and Pakistan and Afghanistan in the east, with which Iran has 909 kilometers (565 miles) and 936 kilometers (582 miles), respectively, of common borderline. Iran also shares 499 kilometers (310 miles) of borderline with Turkey, 992 kilometers (616 miles) with Turkmenistan, 432 kilometers (268 miles) with Azerbaijan, and some 35 kilometers (22 miles) with Armenia, the latter 3 states formerly being part of the USSR.

Most of the 2,440 kilometers (1516 miles) of coastline are on the Persian Gulf and the Gulf of Oman. The 2 gulfs are connected by the strategic strait of Hormuz. Iran has dozens of islands in the Persian Gulf, many of which are uninhabited but used as bases for oil exploration. Those that are inhabited—notably Qeshm and Kish—are being developed, attracting investors and tourists. The Iranian coast of the Caspian Sea is some 740 kilometers (460 miles) long. Apart from being home to the sturgeon that provides for the world's best caviar, the Caspian Sea is the world's largest lake, with an area of some 370,000 square kilometers, and is co-owned by Azerbaijan, Russia, Kazakhstan, and Turkmenistan.

In general, Iran consists of an interior plateau, 1,000 meters to 1,500 meters (3,000 feet to 3,500 feet) above sea level, ringed on almost all sides by mountain zones. The Elburz range with the Iranian capital, Tehran, at its feet, features the country's highest peak, the snowcapped volcanic cone of Mt. Damavand, at 5,604 meters (18,386 feet). To the north of the range there is a sudden drop to a flat plain occupied by the Caspian Sea, which lies about 27 meters (89 feet) below sea-level and is shrinking alarmingly in size. The larger Zagros mountain range runs from north-west Iran down to the eastern shores of the Persian Gulf, and then eastward, fronting the Arabian Sea, and continuing into Pakistan.

The interior plateau of Iran is mostly desert, and the settled areas are generally confined to the foothills of mountains, though oasis towns, such as Kerman, are growing in size. Major towns and historical centers are spread all over the country, such as the country's largest cities of Tabriz (1.2 million) in the far northwestern corner; Mash-had (1.9 million) in the far northeastern corner; Esfahan (1.3 million) to the south; and Shiraz (1.1 million) to the distant south of the capital, Tehran (6.8 million).

POPULATION.

Iran's population was estimated to total 65.6 million in July 2000 according to CIA figures. Almost two-thirds of Iran's people are of Aryan origin— their ancestors migrated from Central Asia. The major groups in this category include Persians, Kurds, Lurs, and Baluchi. The remainder are primarily Turkic but also include Arabs, Armenians, Jews, and Assyrians. Iran's ethnic diversity is reflected in the variety of languages Iranians speak, with 58 percent speaking Persian and Persian dialects, 26 percent speaking Turkic dialects, 9 percent Kurdish, and 7 percent other languages. Persian— an Indo-European language almost unchanged since ancient times with a share of Arabic, Turkic, and European words—is now spoken by the majority of Iranians as their first language and operates as a lingua franca for minority groups. Although granted equal rights by the constitution, ethnic minorities are second-class citizens.

Iran's population is approximately 99 percent Muslim, of which 89 percent are followers of the state religion, Shi'a Islam. Some 10 percent are followers of the Sunni branch of Islam (mostly Turkomen, Arabs, Baluchs, and Kurds living in the southwest, southeast, and northwest). Sufi Brotherhoods (mystical religious orders) are popular, but there are no reliable figures available to judge their true size. Baha'is, Christians, Zoroastrians, and Jews constitute less than 1 percent of the population. The largest non-Muslim minority is the Baha'i faith, estimated at about 300,000 to 350,000 adherents throughout the country. Estimates on the size of the Jewish community vary from 25,000 to 30,000. These figures represent a substantial reduction from the estimated 75,000 to 80,000 Jews who resided in the country prior to the 1979 Revolution. The Christian community is estimated at approximately 117,000 persons. According to government figures the size of the Zoroastrian community was estimated at approximately 35,000 adherents. Zoroastrian groups cite a larger figure of approximately 60,000. Zoroastrianism was the official religion of the pre-Islamic Sassanid Empire and thus has played a central role in Iranian history. Zoroastrians are mainly ethnic Persians concentrated in the cities of Tehran, Kerman, and Yazd. In general, society is accustomed to the presence of Iran's pre-Islamic, non-Muslim communities. However, the government restricts freedom of religion, creating a threatening atmosphere for some religious minorities, especially Baha'is, Jews, and evangelical Christians.

Iran has a relatively young population, with 34 percent of the population under the age of 14 and 61 percent between 15 and 64 years of age. Thanks to a family planning program, population growth decreased from 3.2 percent in 1984 to 1.7 percent in 1998 and further to 0.83 percent in 2000. Of the population, an estimated 38 million Iranians (or 60 percent) live in urban areas, while approximately 27 million live in rural areas. The population density was 37.6 inhabitants per square kilometer (97 per square mile) in 1998, though many people are concentrated in the Tehran region, and other parts of the country (especially deserts) are basically uninhabited. Basic literacy rates are above the regional average, although uncertain reporting standards give a wide margin for error. In 1997-98 the central bank estimated literacy at 80.5 percent in those over 6 years old, with 75.6 percent of women and 85.3 percent of men judged to be functionally literate, i.e. they were taught to read and write at some point.

Between 1920 and 1960 Iran's population doubled to 23 million, and by 1979 the equivalent to the entire population of the country in 1920 had been added. Most of the increase in population migrated to urban centers and found jobs in industry and services, as opposed to agriculture. In 1960, about one-third of the population lived in towns; by 1979 nearly half the population was urban. Tehran became the center of government, higher education, and industry; in 1976, it contained two-thirds of all university students, and nearly one-third of high school students; about half of all factories were in or around Tehran. After the Islamic revolution of 1979, this trend continued. Currently, around 60 percent of the Iranian population lives in towns. Tehran remains the principal political, economic, and industrial center, with a population of 6.8 million, according to a 1996 census, although it is very likely that the metropolitan area accommodates some 11-12 million people, or 20 percent, of the country's overall population.

The civil war in Afghanistan, the Iran-Iraq war of the 1980s, and Iraqi policies in the aftermath of the Gulf War in 1990-91 have caused a constant influx of refugees to Iran. The country hosts the largest refugee population in the world. According to the government, the total refugee population counts 2 million—1.4 million Afghans and 580,000 Iraqis—while a smaller number have been driven into Iran by the conflict in the Nagorny Karabakh region in Azerbaijan. The Iraqis include Kurds from the north and Arab Shiites from the south. Only 5 percent of refugees live in 30 designated camps, while others are scattered among cities and villages throughout the country. The increase in unemployment and deteriorating economic conditions have somewhat eroded the Iranians' so far rather tolerant and welcoming attitude toward refugees, and more pressure is being exerted for refugees to return to their countries of origin. The Iranian government feels it bears a heavy social and economic burden and believes the international community should share more of this burden.

OVERVIEW OF ECONOMY

Iran has a mixed economy that is heavily dependent on export earnings from the country's extensive petroleum reserves. Oil exports account for nearly 80 percent of foreign exchange earnings. The constitution mandates that all large-scale industries, including petroleum, minerals, banking, foreign exchange, insurance, power generation, communications, aviation, and road and rail transport, be owned publicly and administered by the state. Basic foodstuffs and energy costs are heavily subsidized by the government. Although economic performance improved somewhat during 1999 and 2000 due to the worldwide increase in oil prices, performance is affected adversely by government mismanagement and corruption. Unemployment was estimated to be as high as 25 percent, and inflation was an estimated 22 percent. Iran's gross national product (GNP) is the highest in the Middle East, although its GNP per capita is comparatively low because of Iran's large and growing population.

From medieval times until the 20th century, the socioeconomic structure of Iran remained almost unaltered. Only half of the population was settled; the remainder were tribal nomads, mainly engaged in the herding of grazing animals. A system of land assignment was in place, similar to the medieval European system of feudalism, under which the ruler, the shah, granted land to loyal subjects who became absentee landowners, collecting taxes from the peasants on their land. Economic activity further suffered from the handicaps of topography and climate, as well as prolonged political and social insecurity (with constant pressure by foreign powers). Things began to change when Reza Shah Pahlavi, a colonel in the Persian army and founder of the Pahlavi dynasty, seized the throne in 1925 and initiated a modernization of Iran's political and economic system, while also changing the country's name from Persia to Iran.

Following World War II the new shah, Mohammed Reza, guided the economy through public planning, urbanization, industrialization, and investment in the infrastructure , and achieved sustained growth, all supported by substantial oil revenues. Compared with other third world countries during the period from 1960-77, Iran's annual real growth rate of nearly 9.6 percent was about double the average. Therefore, one explanation for the Islamic revolution of 1979 is that the modernization program imposed by the shah was too rapid for the Iranian people, who wished to hold on to their traditional values and ways. Another view suggests that in fact, the shah failed to modernize rapidly enough. The Iranian economic and social infrastructure was found increasingly inadequate to meet expectations, despite rising oil revenues that produced a superficial modernism. The standard of living did increase in Iran during the early 1970s, when per capita income rose from US$180 per year just before the massive oil price increase to US$810 in 1973-74, and up to an estimated US$1,521 just one year later. During the last years of the shah's reign, per capita income rose less rapidly and living costs soared. By 1978, the typical rent for a house in Esfahan had risen from about US$70 per month in 1973 to over US$500 a month, while a typical salary was still below US$2 per hour. In addition, corruption had become widespread.

In 1979 an Islamic revolution ousted Shah Mohammed Reza Pahlavi from power and placed the Shiite clergy in control of the government of the country. The revolution was followed by trade sanctions and the freezing of Iranian assets in the United States after radical Iranian students stormed the American embassy in Tehran and held embassy staff as hostages. These measures and the war which broke out between Iran and Iraq in September 1980 and lasted for 8 years harmed the development of the Iranian economy considerably. Since that conflict, efforts to resume broad economic development and diversification have been hindered by volatile world oil prices, by internal structural weaknesses and rampant inflation, and by persistent political tensions with the West, especially with the United States, which still considers Iran to be the most active state sponsor of terrorism, supporting extremist groups such as Lebanon-based Hezbullah and the Palestinian Hamas.

The most remarkable features of the post-revolutionary Iranian political and economic scene are the influence of the so-called bazaar and the bonyad. The bazaar refers to Iran's traditional import-export markets, the leaders of which wield considerable influence over economic policy. These leaders, known as bazaaris, showed their power in 1978 by calling a series of strikes, paralyzing Iran's economy and speeding up the departure of the shah. Since the revolution the bazaaris have enjoyed a close relationship with the Islamic regime, benefiting from lucrative business contracts in exchange for funding individual mosques and conservative parliamentary and presidential candidates. The bazaar also provides an informal banking service to the private sector and is responsible for much of the black-market trade in currency; as a result, bazaaris tend to oppose exchange-rate reunification. In broad terms, they also oppose wider economic reform, the reduction of tariff barriers, and the greater participation of foreign investors in the economy.

The bonyad (religious foundations) were created after the revolution to safeguard the Islamic Republic's revolutionary principles and to attend to the plight of the poor. While providing much-needed welfare support for the families of those killed or wounded in the Iran-Iraq war, the bonyad have exploited their position to become multi-billion dollar conglomerates controlling large portions of the Iranian economy, especially properties and businesses taken from the Pahlavi family and individuals associated with the monarchy. The larger bonyad, such as the Bonyad-e Mostazafan (Foundation of the Oppressed) and Bonyad-e Shahid (Foundation of the Martyrs), oppose better relations with the West and the liberalization of the economy, fearing that foreign investment in Iran could threaten their economic empires.

In the early 1990s, Iran faced a huge foreign debt and other serious economic dislocations stemming from the nearly decade-long Iran-Iraq war (1980-88), while its population continued to grow at a rapid pace. Most of the economic resources were allocated through the vast public sector , widespread price controls , extensive trade and exchange restrictions, heavily subsidized energy and petroleum products, and protective labor and business practices. With oil prices changing considerably during the 1980s, planning became difficult and resulted in inflation, since the government did not want to borrow on international markets, but financed war-related and other expenses through the central bank. Between 1981-82 and 1984-85, the real GDP had grown by about 8 percent annually, which reflected oil production and export recovery after the low-point during and in the immediate aftermath of the revolution. But when oil prices fell to a historic low in 1987-88, this drop was also reflected in the economy at large, and Iran witnessed a negative growth rate of 10 percent.

After the war, efforts were made to revive oil exports and to shift the economy onto a peacetime basis. Through the 1990s, attempts at privatizing public enterprises, liberalizing prices and the exchange system, removing tariff barriers, and lowering income taxes to encourage investment were made. During the First 5 Year Development Plan (1989-94), these measures worked well and the economy grew in real GDP terms at an average annual rate of 7 percent. While the First 5 Year Development Plan focused on infrastructure development and reconstruction programs, the Second 5 Year Development Plan (1994-99) concentrated on Iran's financial problems. The sharp drop of oil prices in 1998-99 forced the government to abandon structural reforms and brought about a budget deficit of US$2.1 billion, which was financed by monetary expansion, thus accelerating inflation from 17 percent in 1997-98 to 25 percent in 1998-99.

The reformist president Khatami, elected in 1997, has continued to follow the market reform plans of his predecessor, President Rafsanjani, and has indicated that he will pursue diversification of Iran's oil-reliant economy, although he has made little progress toward that goal so far, mainly because of Iran's dependence on oil and the decline in oil prices in the first 2 years of his government. A broad program of economic adjustment and reform was issued in August 1998 to form the Third 5 Year Development Plan (2000-05). It involves restoring market-based prices, reducing the size of the public sector and encouraging private sector investment. As a result, domestic petroleum prices were raised by 70 percent in 1999, and a more market-based official exchange rate was introduced on the Tehran Stock Exchange (TSE).

The recovery of oil prices during 1999-2000 significantly strengthened Iran's external and financial position. Although annual GDP growth remained weak at 2.4 percent and the inflation rate remained almost unchanged at 20 percent, the government incurred a large budget surplus of about US$4.7 billion and hurried to pay external debt , reducing outstanding debt to about 10 percent of the GDP. The Third 5 Year Development Plan aims at accelerating growth to an average annual rate of 6 percent in order to create sufficient employment opportunities for the rapidly growing labor force , which currently increases by an estimated 5 percent every year.

POLITICS, GOVERNMENT, AND TAXATION

The Islamic revolution of 1979, during which the monarch, Shah Mohammed Reza Pahlavi, was driven out of the country, brought the Shiite clergy to power with Ayatollah Ruhollah Khomeini as its charismatic leader. Following the revolution, Iran adopted a constitution based on Ayatollah Khomeini's theory of Islamic government. The constitution ratified by popular referendum established a theocratic (from ancient Greek, literally meaning "the rule of God") republic and declared as its purpose the establishment of institutions and a society based on Islamic principles and norms, adopting the shari'a (Islamic law) as the basis for the country's legal system. The Constitution of the Islamic Republic provided for a Vali-ye Faqih, a Supreme Leader of the Islamic Revolution. Since the death of Ayatollah Khomeini, in 1989, this office has been held by Ayatollah Ali Khamenei. The Supreme Leader still enjoys primary control of many organs of the state and has the right to appoint key officials such as heads of the judiciary, the broadcast media, the armed forces, and various revolutionary bodies, as well as the power to supervise the overall policies of the regime.

The 1979 constitution created an Islamic Consultative Assembly called the Majlis, Iran's most democratic legislature in its history. Its 290 members are elected by universal adult suffrage—men and women from the age of 16 are eligible to vote—and serve for 4-year terms. The Majlis develops and passes legislation that is reviewed for adherence to Islamic and constitutional principles by a Council of Guardians, which consists of 6 clerical members. These are appointed by the Supreme Leader and 6 jurists, who in turn are appointed by the head of the judiciary and approved by the Majlis. The constitution provides the Council of Guardians with the power to disqualify candidates for elective offices based on a set of requirements, including the candidates' ideological beliefs.

The country's president is elected by popular vote to a 4-year term and has the power to appoint a cabinet known as the Council of Ministers, with the approval of the legislature. Mohammad Khatami was elected in elections held on 3 August 1997.

Political parties, legalized in 1998 after a 13-year ban, are still at an early stage of development. Nevertheless, factions within the ruling hierarchy, particularly in the Majlis, are increasingly visible. While these are most often defined broadly as "reformist" or "conservative," political allegiances do exist based on patronage, loyalties, specific interests, and the exchange of favors.

Several agencies share responsibility for internal security, including the Ministry of Intelligence and Security, the Ministry of Interior, and the Revolutionary Guards, a military force that was established after the revolution. Paramilitary volunteer forces known as Basijis, and groupings, known as the Ansar-e Hezbollah (Helpers of the Party of God), who often are aligned with specific members of the leadership, act as watchdogs, intimidating and physically threatening demonstrators, journalists, and individuals suspected of counter revolutionary activities. According to Amnesty International and Human Rights Watch, both regular and paramilitary security forces committed numerous serious human rights abuses. Iranians also suffer from violations of freedom of expression. Iran's conservative-dominated judiciary waged an extensive campaign against the local reformist press, closing newspapers and prosecuting critical journalists throughout 2000.

HISTORICAL BACKGROUND.

Although briefly occupied during World War II by Soviet and British troops, Iran is 1 of only 2 countries in the Middle East that were never colonized (the other being Saudi Arabia). However, the country's geopolitical significance—Iran has the longest Gulf shoreline and is a vital link between Asia, the Middle East and Europe—has made it of central concern to the world's most powerful empires and a target for frequent political manipulation. Following the occupation of Iran by allied forces during World War II, Iran's Pahlavi ruler, Reza Shah, was forced to abdicate in favor of his son, Mohammed Reza.

Mohammed Reza Pahlavi sought to ally Iran closely with Western powers and particularly with the United States. However, growing nationalist sentiment in Iran forced him to appoint the nationalist Mohammed Mossadeq as prime minister in 1951. Prime Minister Mossadeq nationalized the Anglo-Iranian Oil Company (AIOC) the same year, sidelining the shah politically. Alarmed at the threat the nationalist leader posed to their position in the Gulf and the broader Middle East, the Western powers imposed an oil embargo on Iranian exports, crippling the government. This was followed in 1953 by support from the U.S. Central Intelligence Agency (CIA) and the British counter-intelligence agency, MI6, for a successful coup, which overthrew Mossadeq and returned authority to the shah. Mohammed Reza subsequently initiated a massive modernization program, known as the "white revolution," accompanied by a greater centralization of power and increased use of repression to subdue political dissent. In 1964 the government exiled the cleric Ayatollah Khomeini after a series of his speeches led to widespread rioting.

The oil price explosion of 1973-74 fueled rapid economic growth, but at the cost of increased volatility in the Iranian economy and high levels of inflation. Economic hardship, the growing dominance of Western culture—which traditional Iranians found offensive—and the government's repressive security methods brought about an increasingly determined collection of opposition groups. Unifying into an anti-monarchist coalition with Ayatollah Khomeini as their figurehead, these activists organized nation-wide demonstrations and strikes, culminating in the overthrow of the Pahlavi dynasty in February 1979 and the return of Khomeini from exile. Following a popular vote, Iran became a self-styled "Islamic Republic" in March 1979.

International opinion turned strongly against the new government in November 1979, when militant students seized the U.S. embassy in Tehran and held 52 people hostage for more than a year. In September 1980, Iraqi forces invaded Iran, hoping for an easy victory that would allow the annexation of Iranian territory around the strategically important Shatt al-Arab waterway. While remaining neutral, the Western powers, together with many Arab states, assisted Iraq in order to suppress Khomeini's Islamic state. Until August 1988, when Iran finally accepted a U.N. cease-fire resolution, the 2 countries engaged in one of the bloodiest wars of the century, suffering widespread human and economic losses. Ayatollah Khomeini died in June 1989, and the Council of Experts, a clerical body empowered to choose the next Supreme Leader, selected Hojatoleslam Seyyed Ali Khamenei as Khomeini's successor, rapidly promoting him to the clerical rank of Ayatollah (literally: Sign of God). Hojatoleslam Ali Rafsanjani won the presidential election in August of the same year.

Since the amendment of the constitution in 1989 the president has appointed the government, though all ministers must be approved by the parliament before taking office. Iran's domestic politics have since evolved into an increasingly bitter power struggle between conservatives and reformers within the regime. From 1989 to 1997, President Rafsanjani sought to implement a program of gradual economic and political reform, but his more conservative rivals frequently blocked his policies. In 1997, the reform-orientated cleric, Mohammad Khatami, was elected to a 4-year term as president in a landslide victory and is set to stand a second term in June 2001 after winning the election with a great majority, almost 77 percent of the votes cast. Though with a turnout at the polls of only 65 percent of eligible voters, after 90 percent in the 1997 election, people seem to be disillusioned by politics and the pace of reform. Mohammed Khatami's reform-orientated supporters also defeated the conservatives in the parliamentary election held in February 2000, gaining majority control. Nevertheless, the power struggle with the conservatives continues. Through their control of various oversight institutions, the judiciary and state-run broadcasting, they manage to contain power.

INFRASTRUCTURE, POWER, AND COMMUNICATIONS

Iran's infrastructure is relatively poor and inadequate. Part of this stems from the fact that the vast country was never fully developed, but it also experienced considerable setbacks during the Iran-Iraq war of the 1980s, and restoration since then has been slow.

TRANSPORTATION.

Iran has a network of 140,200 kilometers (87,120 miles) of roads, of which 49,440 kilometers (30,722 miles) are paved. The 2,500-kilometer (1,553-mile) A1 highway runs from Bazargan on the Turkish border across Iran to the Afghan border in the east. The A2 runs from the Iraqi border to Mirjaveh on the Pakistani frontier. Tehran is linked to major cities in the vicinity by 470 kilometers (292 miles) of express-ways. A heavy expansion of car use has led to increased demand for fuel, severe overcrowding of roads in metropolitan areas, and mounting pollution problems. Government estimates put the average annual increase in domestic fuel consumption at 5.5 percent, well above the real economic growth rate. The government has sought to limit motor use by raising domestic fuel prices, but petroleum products in Iran remain heavily subsidized and among the cheapest in the world.

An important transportation link is the railway constructed with great effort before World War II between the Caspian Sea, Tehran, and the Persian Gulf. Other rail links with neighboring countries already exist or are under

der construction. Recently the long-closed link to Van in Eastern Turkey reopened, enabling passengers and goods to travel from Tehran to Istanbul and on to Europe. Overall, the Iranian railway network covers 5,600 kilometers (3,480 miles).

The Shatt al-Arab, the main waterway shared by Iran and Iraq on the Persian Gulf, is navigable by maritime traffic for about 130 kilometers (81 miles). Ports include Abadan/Khorramshahr, which was largely destroyed in fighting during the Iran-Iraq war, and has been overtaken by Bandar Abbas as the country's major port. About 12 million tons of cargo pass through Iran's Gulf ports each year. Smaller ports at Bushehr, Bandar Lengeh, and Chah Bahar have also assumed new importance. The 1998 Lloyd's Register of Shipping lists 382 Iranian merchant vessels.

The 3 major international airports of Tehran, Bandar Abbas, and Abadan, have recently been joined by the international airports on the free-trade islands of Qeshm and Kish. Most domestic and international flights go through Mehrabad international airport in Tehran. The huge Imam Khomeini international airport to the south of Tehran, currently under construction, is going to take over operations in a few years with a projected capacity of 30 million passengers a year. The state-owned national carrier, Iran Air, serves 15 Iranian cities and runs scheduled routes in the Gulf, Asia, and Europe. In 1997 it carried 907,000 international and 6,240,000 domestic passengers.

POWER.

Electricity generation was severely restricted by Iraqi attacks on power stations during the Iran-Iraq War, reducing available capacity from 8,000 MW to 5,000 MW, according to estimates. In December 1988, the Ministry of Energy stated that the general capacity of the national grid was deficient by at least 2,500 MW, owing to war damage, lack of fuel, and inadequate rainfall. At the beginning of the 1990s, residential consumption accounted for about 40 percent of total consumption, and industry for about one-quarter. However, industrial demand rose dramatically and accounted for almost half of total consumption in 1998. Overall consumption reached 90 billion kilowatt hours (kWh) in 1998, up from 73.4 billion kWh in 1994. Installed power production capacity had reached about 24,000 MW, with another 4,600 MW coming from private generators.

Iran plans to increase this capacity to 96,000 MW by 2022. Power plants currently under construction, and due for completion by 2002, will add about 13,000 MW to the national grid. Some 8,000 MW of this will come from hydroelectric (turbines powered by water that generate electricity) dams, although the proportion of hydroelectricity will fall in subsequent years. The balance of 5,000 MW under construction comes from gas-fuelled plants and other facilities. Currently, some 89.5 percent of electricity is produced by thermal power plants (using fossil fuels like coal, oil, or gas) and the rest by hydro-electric stations. Recent years have seen Iran advancing on a nuclear power program of 3,000-5,000 MW. The United States stated that nuclear cooperation and the transfer of technology to Iran was dangerous, as it would accelerate a secret program to develop nuclear weapons. Nevertheless, Chinese and Russian officials have expressed their determination to proceed with deals aimed at selling nuclear reactors to Iran.

TELECOMMUNICATIONS.

As a result of heavy investment in the telephone services since 1994, the number of long-distance channels has grown substantially; many villages have been brought into the net. The number of main lines in the urban systems has approximately doubled since 1994, and the technical level of the system has been raised by the installation of thousands of digital switches. Countrywide, there were some 7 million lines in 1998. There is now also a mobile cellular system in place that was serving 265,000 subscribers in August 1998. This figure is up from under 60,000 in 1996 and has grown rapidly since.

Iran has radio relays to Turkey, Azerbaijan, Pakistan, Afghanistan, Turkmenistan, Syria, Kuwait, Tajikistan, and Uzbekistan. The fiber-optic Trans Asia Europe line runs through northern Iran, and the country is also connected to the Fiber-optic Link Around the Globe (FLAG) through a submarine fiber-optic cable link to the United Arab Emirates.

Internet access is increasing. However, price rather than official censorship remains the greatest hindrance to wider use. The state remains in control of terrestrial radio and television broadcasts, but the illegal use of satellite television receivers in urban areas continues to be widespread. There were 82 radio stations in 1998, and Iranians had 17 million radios. Television receivers numbered 4.9 million.

ECONOMIC SECTORS

Iran's economy clearly relies on its natural resources, and most importantly, oil. Agriculture still contributed 21 percent to the GDP in 1999, while industry accounted for 34 percent, and services for 45 percent. About one-third of the labor force is engaged in agriculture (33 percent); industry employs 25 percent of the workforce and 42 percent are occupied in services. Except for petroleum and petrochemical industries, Iran also has industrial production in steel, textiles, cement and other construction materials, food processing (especially sugar refining and vegetable oil production), metal fabricating, and armaments.

After the Islamic revolution in 1979, Iran nationalized all major industries, banks, and insurance companies. It committed itself to heavy investment in both the agricultural sector and selected industries, with the ultimate goal of economic independence, but unstable internal conditions and the war with Iraq made economic growth almost unattainable until the mid-1990s. The revival of oil production helped stabilize national finances, and free-market initiatives and reforms sparked a rise in domestic agricultural and industrial production.

AGRICULTURE

Iran is a mostly arid or semi-arid country, with a sub-tropical climate along the Caspian coast. Deforestation, desertification , overgrazing, and pollution from vehicle emissions and industrial operations have harmed the land over the last few decades and hampered production. Other significant problems include poor cultivation methods, lack of water, and limited access to markets. Iran's agricultural sector is especially dependent on changes in rainfall, and although the government has attempted to reduce this dependence through the construction of dams, irrigation and drainage networks, agriculture remains highly sensitive to climate developments. Still, the agricultural sector accounts for about one-fifth of the GDP and employs one-third of the workforce. The country's most important crops are wheat, rice, other grains, sugar beets, fruits, nuts, cotton, and tobacco. Iran also produces dairy products, wool, and a large amount of timber. Irrigated areas are fed from modern water-storage systems or from the ancient system of qanat. Qanat are underground water channels stretching up to 40 kilometers (26 mi) and first used at least 2000 years ago. Unfortunately, many of them have fallen into disrepair in recent years.

The centerpiece of the "white revolution," during which the shah pressed the modernization of Iran during the 1960s, was land reform. Until the 1950s, only about 5 percent of peasants owned sufficient land to maintain themselves. The dominant figures in rural areas were the landowners; it is estimated that about half of Iran's cultivated land was held by big landowners, those who controlled one or more villages, a typical holding being between 20 and 40 villages (there were some 70,000 villages altogether). These landowners were absentees and included members of the royal family, military officers, tribal shaykhs, religious dignitaries, and big merchants. The land reform, which began in 1961 and was not completed until 1971, had dramatic effects. The power and influence of large landowners was extinguished; smaller absentee landowners survived and in 1971 still owned half of all cultivated land. Seemingly, the benefits went to those 50 percent of peasants who had cultivation rights. By 1971, 90 percent of them were owners of land, though it turned out that for most of them acquired holdings were too small to support a family. Farm laborers remained without rights and holdings.

The traditional dominance of agriculture was eroded by oil and gas exploitation, which became the country's major source of export revenues as population growth made Iran a net importer of foodstuffs. The agricultural sector has nevertheless usually been the largest contributor to the GDP, its share falling only slightly in the 1990s, from 23.9 percent in 1992-93 to 19.7 percent in 1997-98, when it was overtaken by the industrial sector. In 1999-2000, real growth in the sector declined by 0.3 percent, production of cotton fell by 9 percent, and wheat and barley outputs declined by 27 percent and 39 percent, respectively. This came after the successful year of 1998-99, when a rise in rainfall led to sharp overall growth in the sector, achieving 9.5 percent growth. The government continues to gear efforts toward reducing its role in agriculture and encouraging private sector activities and the growth of cooperatives, while restricting itself to the provision of infrastructure. Subsidies have been reduced over the last few years, but agriculture remains favored with price guarantees and persisting subsidies, in particular for wheat.

The offshore fishing industry is important in Iran both for domestic consumption and for export, mainly of caviar. The total Iranian fish catch rose from 327,727 metric tons in the year 1991-92 to 385,200 tons in 1997-98, of which 244,000 tons came from the Persian Gulf and the Gulf of Oman, 76,200 tons from the Caspian Sea, and 65,000 tons from inland waters. The government remains committed to increasing the annual catch to at least 700,000 tons, principally by the development of fisheries in southern waters. The caviar industry, which enjoys a worldwide market, is by far the most developed field within Iran's fisheries sector. Iran, Russia, Azerbaijan, Kazakhstan, and Turkmenistan form a cartel to protect caviar prices and sturgeon stocks in the Caspian Sea, but over-fishing has begun to threaten the industry. Caviar exports averaged around US$30 million per year in the 1990s.

INDUSTRY

Petroleum and natural gas clearly dominate Iranian industry, which is mostly controlled by the state or run by one of the religious foundations, the bonyad. With the revolution came nationalization, and by the end of 1982, 130 nationalized industries were under the direct control of the 3 ministries that were authorized to conduct industrial policies, and 450 industrial units were placed under the control of the National Iranian Industrial Organization.

MINING/HYDROCARBONS.

Iranians became involved with oil before most of the rest of the world, granting their first exploration concession to British prospectors in 1901. After the discovery of commercially viable deposits at Masjid-e Suleiman in 1908, the reserves were worked by the newly formed Anglo-Persian Oil Company, which changed its name to the Anglo-Iranian Oil Company (AIOC) in 1935 and is now known as BP Amoco. The oil industry's pivotal position in modern Iranian society was demonstrated during the 1979 revolution, when a series of strikes at oil installations culminated in the strikers' refusal to resume exports until the shah left the country. Iran's petroleum industry suffered extensive damage to wells, refineries, and export terminals with the outbreak of the Iran-Iraq war in 1980. Crude oil production recovered to 3.2 million barrels per day (bpd) in 1990 and since 1994 has averaged around 3.6-3.7 million bpd. Proven oil reserves at the end of 1998 totaled 90 billion barrels, representing 8.7 percent of world reserves, and were expected to last about 70 years at current production rates. As of January 2000, Iran possessed 9 operational refineries with an aggregate capacity of 1.5 million bpd, the government's aim being to boost refining capacity to 2 million bpd during its Third 5 Year Development Plan (until 2005).

The dramatic decrease in world oil prices from late 1997, to below early 1973 levels in real terms, prompted the Organization of Petroleum Exporting Countries (OPEC, a cartel grouping together most significant oil producing countries to fix production quotas and attempt to stabilize prices) to decree that its members should reduce production from April 1998 in an effort to boost prices. In March 1999 Iran agreed to cut its output from the benchmark of an average production of 3.6 million bpd by 7.3 percent, to 3.36 million bpd. In their September meeting OPEC countries decided to retain reduced quotas despite the sharp rise in world oil prices. When in March 2000 OPEC responded to what was seen as a dangerously high world oil price of US$30 per barrel by increasing aggregate production quotas by 1.7 million bpd, only Iran declined to accept the plan proposed by Saudi Arabia, on the grounds that OPEC was buckling to U.S. pressure for lower oil prices. However, resistance was short, and the new Iranian production quota had increased to 3.84 million bpd by September 2000. As a result of the production cuts in 1999, exports fell by 10 percent from 1998-99 to 1999-2000, to 2.1 million bpd. Thanks to higher prices, however, oil export revenues increased by 63 percent to US$16.3 billion and are expected to hit the US$20 billion in 2000-01.

Iran's petroleum industry basically works as an extension of the government. The Minister of Petroleum serves as chairman of the 3 main companies, the National Iranian Oil Co. (NIOC), the National Iranian Gas Co. (NIGC), and the National Petrochemical Co. (NPC). The NIOC handles oil and gas exploration, production, refining, and oil transportation; NIGC manages gathering, processing, transmission, distribution, and exports of gas and gas liquids; and NPC handles petrochemical production, distribution, and exports. The majority of Iran's oilfields are concentrated in the southwest of the country, where 90 percent of Iran's total production of crude oil is produced. The state-owned gathering and distributing system for natural gas from Iran's enormous reserves—second in the world only to Russia's—is one of the largest in the Middle East. Other mineral resources are largely underdeveloped.

With proven natural gas reserves of 23 trillion cubic meters (at the end of 1999), Iran is the world's second richest country in gas resources after Russia, with some 15.7 percent of the global total and 46.4 percent of the Middle East regional total. Production increased from 12.2 billion cubic meters in 1989 to 29.5 billion cubic meters in 1993 and to 54 billion cubic meters in 1998, the bulk of which was consumed domestically in line with the government's policy of substituting gas for petroleum. Currently, natural gas accounts for about 40 percent of total domestic energy consumption. Iran plans to construct a 1000-kilometer (621-mile) onshore and 1200-kilometer (746-mile) offshore gas pipeline to India. In 1996, Iran signed an agreement worth US$20 billion to supply gas to Turkey over a 22-year period. With pipeline construction in its final stage, deliveries should begin in mid-2001. In April 2000, the discovery of the country's biggest onshore gas field to date, north of the city of Bushehr, was announced. It is estimated to contain 445,000 million cubic meters of gas not needing to be refined, as well as 240 million barrels of liquid gas. The field is to be brought to production by 2002 and is expected to yield revenue of US$16.5 billion over 20 years.

In addition to the enormous hydrocarbon reserves, Iran has considerable mineral resources. Around 80 million tons of minerals are quarried each year from some 1,500 non-metallic and 50 metallic mines in Iran, with the bulk coming from mines owned by the Bonyad-e Mostazafan (Foundation of the Oppressed). Minerals currently being worked include copper, lead-zinc, iron ore, bauxite, coal, strontium, gold, chromium, uranium, red oxide, turquoise, sulphur, and salt. Foreign investors have concentrated most on Iran's copper-extraction industry, which has taken the lead in moves towards privatization.

MANUFACTURING.

Iran's industrial sector is dominated by relatively few but large public enterprises accounting for approximately 70 percent of value added in manufacturing. Steel, petrochemicals, and copper remain the country's 3 basic industries. Other important branches are automobile manufacturing (mainly assembled under license from Western or Japanese manufacturers), construction material, textiles (mainly woven carpets, for which Iran has traditionally been famous), food processing, and pharmaceuticals. Despite large investments in the 1970s, problems persist to this day, including a shortage of skilled labor, insufficient raw materials and spare parts, and an inadequate infrastructure.

After the revolution in 1979, no clear policy was formulated for the industrial sector. Subsequently, then-president Bani-Sadr estimated a drop of at least 34 percent in industrial output in the first post-revolutionary year alone. The manufacturing industries' poor performance continued throughout the 1980s with many factories still operating at only 30 percent of their capacity at the end of the decade. Much of this downturn had to do with the emigration of industrial owners and a resulting shortage of managerial skills. The high degree of Iran's dependency on imports for raw materials, along with the economic sanctions imposed against the Islamic Republic, further increased the vulnerability of the manufacturing sector. Taken together, these factors resulted in inefficiency and low productivity.

The steel industry is one of the few exceptions to Iran's disappointing manufacturing scene. Development began late—Iran's first steel mill was a joint venture with the Soviet Union in the 1960s—and proceeded slowly, with output standing at just 1 million tons per year in 1979. Since the end of the Iran-Iraq war, however, a huge expansion has taken place. New plants have been commissioned in Khuzestan, Khorasan, and Azerbaijan provinces, and Iran has become the world's third largest steel producer, with an output of 6.7 million tons in 1997-98.

In recent years the government has placed great emphasis on expanding the petrochemical industry to generate products of higher value added and higher export earnings. In the medium term the petrochemical industry represents Iran's only chance of diversifying away from crude oil exports. Iranian petrochemical production has more than doubled in the last 5 years, making it the second largest producer in the region, after Saudi Arabia. Total petrochemical output was estimated at about 12 million tons in 1998, compared to 2.4 million tons in 1989. The government plans to triple the annual output to 30 million tons within 20 years, which requires investments of US$20 billion. Government predictions were that Iran's share of the world's petrochemical production would reach 2 percent by 2005 and that the value of exports would rise from US$500 million in 1999 to US$2 billion in 2005. Main petrochemical products are fertilizers, methanol, aromatics, and olefins.

The automotive sector is underdeveloped. The most common vehicle on Iran's roads is the Paykan, the locally produced version of a 1960s British model. The car's old-fashioned engineering makes it inefficient and one of the worst polluters in the country. Since 1989, the industry has enjoyed a modest recovery, as local plants have contracted to assemble Nissan, Peugeot, and Kia models under license. Some manufacturers, such as Iran Khodro, which held the rights to assemble General Motors vehicles until 1985, have begun to modernize and restructure . Local production of cars reached 245,556 units in 2000-01, compared to some 80,000 units in 1995-96, and up 23 percent from the previous year. However, poor access to finance and a shallow inventory suggest that there is further need for improvement.

In 1995, the Chamber of Commerce and Industry reported that Iran's textile mills were operating at an average of 56 percent of their capacity, owing to shortage of foreign exchange and raw material. The textiles industry is partly based on domestic supply of cotton. During the 1970s, European manufacturers purchased Iranian cotton, but as profits fell in the 1980s, most cotton was absorbed domestically. The government hopes to promote textile exports, and some public investment has been devoted to improving production quality. However, the results have been visible only in niche areas, and export earnings in 1997-98 remained below US$100 million per year. Revenues from exporting carpets dropped severely in the 1990s from US$2 billion in 1990 to US$570 million in 1998, rendering it a shaky business.

SERVICES

The services sector is the largest in the Iranian economy and contributed approximately 40 percent to the GDP during 1999-2000. The sector has seen the greatest long-term growth in terms of its share of the GDP, but currency-exchange restrictions, excessive bureaucracy, and the uncertainty of long-term planning have hindered further development.

FINANCIAL SERVICES.

The Iranian banking sector is dominated by 10 state-owned banks, including the 6 full-service commercial banks, and 4 sectorally specialized ones. In addition, 4 small private non-bank credit institutions have recently been licensed. The total number of state-owned bank branches was 14,518 in 1999, compared with 11,634 in 1995. Commercial banks engage mainly in short-term lending, primarily to the private sector and public non-bank financial enterprises, and act as agents of depositors in the investment of funds. The profits and losses from these investments are then distributed to depositors based on the duration and amount of their investment. Specialized banks lend mainly on a long-term basis (5 years or more) and have investments in various sectors of the economy.

After the revolution, 2 major changes were made in the banking system: one was nationalization and restructuring in the year immediately after the revolution, the other was the introduction of Islamic banking in 1983-84. Islamic banking is characterized by the prohibition of interest on loans, according to Islamic law. Interest on loans, or riba, was replaced by a commission of 4 percent a year compared with the traditional 14 percent, whereas interest on deposits was replaced with profits, estimated at a minimum of 7-8 percent a year. The banks would become temporary shareholders in major industrial enterprises to which they lent money. Unfortunately, the changes to the banking sector were made just when the public sector was relying heavily on the banking system to finance the large deficit, due to low oil revenues. Consequently, the inflation rate accelerated rapidly. While it amounted to only 4 percent in 1985-86, it surged to 21 percent the following year, and increased to 28 percent and 29 percent, respectively, during 1987-88 and 1988-89 and has since remained at a high level.

The Tehran Stock Exchange (TSE) benefitted from a wave of privatization during the early 1990s. Stock market capitalization of IR38 trillion at the end of 1999 corresponded to about 9 percent of the GDP, although relatively few of the shares are routinely available for purchase by the general public. The ownership of stocks is highly concentrated. The largest 5 shareholders account, together, for more than 82 percent of company shareholdings. A small handful of institutional investors dominate the market as a whole. These are all either government institutions or state-owned banks or their subsidiaries, but nevertheless operating on a market-oriented basis.

COMMERCE.

Iran has traditionally been an agricultural nation populated by traders. With the exception of the carpet industry and a tiny jewelry industry, the Iranian economy was essentially agrarian until the time of Reza Shah Pahlavi. Despite the crash industrialization program launched by the Pahlavi regime in the 1960s and 1970s and the necessity for self-sufficiency during Iran's 8-year war with Iraq, the country retains its preference for trade over production.

The merchant, or bazaar, classes had profited from the economic boom Iran experienced under the shah in the 1970s. Many had amassed fortunes in these years. Yet, the bazaar provided valuable support to the revolutionary movement, contributing generously to the clerical cause in the lead-up to the revolution. The bazaar merchants had several grievances against the shah, whose policies favored a new industrial and entrepreneurial elite, and import licenses made life difficult for the smaller merchants. The bazaar was relegated to secondary status, especially after some of the major industrial families started combining interests in industry with interests in banking, insurance, and trade by the mid-1970s; several of the largest trading companies developed alongside major industrial enterprises. These new trading companies threatened to drive the bazaar merchants out of wholesale trade, and then, by establishing new retail networks and outlets, out of retail trade as well.

After the revolution, the trading sector achieved positive growth, and this sector absorbed most of the new entrants into the job market. In the absence of a properly functioning banking system, demand for capital has been frequently met from moneylenders in the bazaar. Indeed, currency exchange and money lending has become a major source of business for the bazaar's traders in Iran's distorted economy. This further intensified a tendency among Iranians to invest in businesses with a cash-based return, such as constructing homes for the rental market or the import of consumer goods .

TOURISM.

Before the revolution Iran had begun to build a reputation as an exotic holiday destination; its ski resorts at Shemshak and Dizin, north of Tehran, attracted international celebrities. After 1979, the Islamic government discouraged tourism, leaving many renowned archaeological and historical sites, including Persepolis, Pasargard, and Esfahan, barely visited by foreigners. Although hardly a booming sector, visitor rates are beginning to rise. The government has begun to issue visas more freely to non-Muslim individuals and groups, and the country is appearing with greater frequency in tourism brochures, but still only around 320,000 foreign tourists actually visit, bringing in revenue of US$170 million. The bulk of tourism remains to be founded on Shia pilgrimage centers such as Mashhad and Qom. The Bonyad-e Mostazafan (Foundation of the Oppressed), which owns most of Iran's large hotels, plans to increase the number of hotel beds from the current 34,500 to 59,500 by 2002.

INTERNATIONAL TRADE

Following a strong balance of payments performance in 1996-97, mainly due to high oil prices, the period 1997-99 witnessed the deterioration of Iran's external accounts, triggered by tumbling oil prices and stagnant non-oil exports. Imports went down due to the resulting scarcity of foreign exchange, and Iran negotiated re-phasing part of its external debt in 1998 in order to alleviate financial pressure. When oil prices recovered during 1999-2000, and non-oil exports also grew by 9

percent, the Islamic Republic's external position was enhanced considerably. Iran's trade balance had dropped from a surplus of US$2.8 billion in 1996-97 to a deficit of US$4 billion in 1997-98, although this was reversed again into a US$2 billion surplus in 1999-2000. The International Monetary Fund (IMF) in its 2000 country report on Iran estimated that exports during 1999-2000 totaled US$19.726 billion, while total imports that year amounted to US$13.511 billion. Changes in Iran's external balance are mainly dependent on oil prices. Thus, in 1999-2000, proceeds from crude oil exports rose by 60 percent, despite a decline in the export volume, reflecting the 77 percent increase in the average export price of Iranian crude oil.

Non-oil exports consist mainly of consumer goods (55 percent on average during 1997-2000), followed by raw materials and intermediate goods (about 38 percent). Carpets remain the single most exported Iranian non-oil product. Such exports have declined significantly over the second half of the 1990s, from US$2 billion in 1994 to US$570 million in 1998, which is attributed to competition from low-priced carpet-producing countries. Exports of fresh and dried fruits, at about US$600 million in 1998-99 (of which $416 million came from pistachios alone), have captured a larger share of the total. Chemicals are the most prominent export of raw materials and intermediate goods, hovering at about US$500 million during 1997-2000.

The direction of exports has also remained unchanged since the mid-1990s. While Japan and the United Kingdom are the largest importers of Iranian goods (absorbing about 16 percent and 17 percent of total exports, respectively), Germany and the United Arab Emirates (UAE) are the main destinations for non-oil exports, capturing 13 percent and 16 percent of these exports, respectively. Other important destinations for Iranian exports are Italy (6 percent of non-oil exports and 9 percent of total exports), Greece and South Korea (5 percent of total exports), and Turkey (5 percent of non-oil exports).

Iran imports mainly raw materials and intermediate and capital goods . Imports of consumer goods, at about US$2 billion per year, represent only 14 percent of total imports. Imports of machinery and tools average about US$4-5 billion, which cover the bulk of capital goods imports. Iran's imports of grains and derivatives fell drastically in 1998-99 from about US$1.8 billion the previous years to below US$900 million. Iran also imports a large quantity of chemical products, totaling about US$1.8-2 billion per annum. The most important sources of Iranian imports are Germany (12 percent), Japan (7 percent), and Italy (6 percent).

Since Iran's first application to join the World Trade Organization (WTO) in 1996, it has been constantly blocked by the United States. The application was blocked again in May of 2001, but the administration of U.S. President George W. Bush is thought to be considering dropping its objection now that Egypt has sponsored Iran's application. Iran is a founding member of the Asian Clearing Union (ACU), established in 1974 to provide a mechanism for the settlement of transactions among countries in the Asia-Pacific region. Members are Bangladesh, Burma, India, Nepal, Pakistan, Sri Lanka, and Bhutan. Iran undertakes only about 3 percent of its total trade within the ACU, with Bangladesh, India, Pakistan, and Sri Lanka importing oil and oil products, handicrafts, and machinery equipment. Iran's imports from these countries include machinery, spare parts, and spices from India, jute from Bangladesh, and rice and cotton from Pakistan.

MONEY

The Bank-e Merkazi-ye Jomhuri-ye Eslami-ye Iran, or Central Bank of the Islamic Republic of Iran, is the highest monetary authority in the country. Each year after the approval of the government's annual budget, the Central Bank presents a detailed monetary and credit policy. Short-term credit policies need to be approved by the

government and long-term credit policies have to be incorporated into the 5 Year Development Plan with Parliament's consent.

After the introduction of the Tehran Stock Exchange (TSE) rate in July 1997 and until March 2000, 2 officially recognized exchange rates coexisted in Iran. The official rate of the Iranian rial—1,750 per U.S. dollar—applies to oil and gas export receipts, imports of essential goods and services, and repayment of external debt. The "export" rate, fixed at 3,000 rials per dollar since May 1995, applied to all other trade transactions, but mainly to capital goods imports of public enterprises. In order to ease pressure on exporters, the bank introduced a currency certificate system allowing exporters to trade certificates for hard currency on the Tehran Stock Exchange (TSE). This method finally replaced the fixed export rate in March 2000, and has since held steady at some IR8,500:US$1. There is an active black market in foreign exchange, but the development of the TSE rate and the ready availability of foreign exchange over 2000 narrowed the differential to as little as IR100 in mid-2000. The reunification of Iran's multi-tiered exchange-rate system, which has plagued Iran's non-oil exports and frustrated potential investors since the revolution, had been under discussion since a failed attempt in 1993 to operate a single, floating exchange rate . At the same time, as a step toward further liberalization and integration of foreign exchange markets, banks were allowed to deal relatively freely with foreign exchange. Despite this, foreign currency is still hard to get and even harder to keep for ordinary Iranians.

Given recent government decisions to allow banks to sell currency at free-market rates, together with the positive outlook for oil earnings, and the apparent willingness of new lenders, particularly European banks, to extend new credit lines to Iran, an attempt at reunification is likely to be made in 2001-02, at a rate of around IR9,000=US$1.

POVERTY AND WEALTH

Before the Islamic revolution, Iran had gradually been transformed from a largely farm-based economy to a modern society by ways of major changes in the traditional

socioeconomic order between 1946 and 1979. Under the shah, thanks to considerable outlays allocated to education and health, great strides were made in improving social welfare. Infant mortality, malnutrition, endemic diseases, and illiteracy were greatly reduced. Caloric intake, life expectancy, and school enrollment were all markedly increased. While rural-income gaps and income inequalities within the respective areas did not narrow, indicators showed that absolute poverty was reduced. Although elementary school enrollment during the 1970s quadrupled to more than 9 million, this was achieved in many cases only by running students through in 3 shifts and having teachers in the classroom 60 to 80 hours a week. About 90 percent of high school graduates were denied admission to college because of inadequate facilities. About 20 percent of Iran's institutions of higher education had no library facilities, nor were they likely to obtain them because, while the state budget set aside 5 percent for sports, it did not have any reserves for books and libraries.

It was thought and hoped that the new regime would remedy these faults. The Islamic government declared a policy of improving the lot of the poor for whom, after all, the revolution itself had been launched, but there has been little evidence of success. Nominal wages and salaries lagged behind inflation throughout the 1980s, which according to one Majlis deputy left more than 90 percent of public servants below the poverty line. According to the official line, the poor were better off after, rather than before, the revolution. This was undoubtedly true for certain groups of people who have been especially well positioned within the regime, such as members of the Revolutionary Guards, many families of the war dead, some among the subsidized urban proletariat, and others from extremely low-income households. It does not hold true, however, for the majority of the population. In 1972, some 44 percent of the population were living below the subsistence poverty line. During the 1979-85 period, absolute poverty increased by 40 percent; some reports indicated that absolute poverty had spread among as many as 65-75 percent of the population in 1988. According to the IMF, 53 percent of Iranians still live below the poverty line.

Health conditions outside major cities are poor. Many small towns and rural areas suffer from unsanitary conditions and a shortage of medical personnel and facilities. The infant mortality rate remains a serious problem; it is very high by world and Middle Eastern standards, although it has been reduced significantly (26 deaths per 1,000 live births in 1998, down from 91.6 during 1980-85 and 50 during 1991-95). Although primary education is compulsory for 5 years, many rural children never attend school because of either parental objection or a lack of facilities. The secondary-school system in Iran is relatively underdeveloped, and it serves for the most part to prepare small numbers of students for university-level education. In order to improve the situation for the poorest segments of Iranian society, the government is considering an anti-poverty program comprising expanded provision of food, clothing, health care, education, social security, and bank credits to these people.

WORKING CONDITIONS

The highly fluid nature of Iran's labor market and the large size of the informal services sector make accurate estimates of employment levels difficult. A census, conducted in 1991, recorded 25.2 percent of the 57.8 million population as economically active, and 22.3 percent as in employment, suggesting that around 11 percent of the workforce was unemployed. However, the census ignored the fact that most Iranian adults must hold 2 or even 3 jobs in order to provide for the rest of their family. The government put unemployment at 2 million in 1997-98, equivalent to 12.1 percent of the workforce and up sharply from the previous year's estimate of 9.1 percent. Given the rapid population growth experienced over the past 20 years, together with a real reduction of government resources aimed at job creation, it is likely that even this estimate is too conservative. According to the Economist Intelligence Unit (EIU), an accurate estimate for unemployment figures lies between 14 percent and 18 percent, while the IMF suggests it may be as high as 25 percent.

High inflation has been another characteristic of the Iranian economy since the early 1970s and played a crucial role in the industrial action that presaged the 1979 revolution. In recent years changes in the exchange rate, the gradual removal of subsidies, and the suppression of imports have all contributed to rising prices and eroded real wages . Some evidence indicates that inflation has dropped steadily since 1995, settling in a range of 22-30 percent, according to sources from the International Monetary Fund (IMF).

The Labor Code empowers the Supreme Labor Council to establish annual minimum wage levels for each sector and region. The minimum wage has been inadequate for some years by the government's own admission. Officially the minimum wage should be sufficient to meet the living expenses of a family and should take inflation into account. The daily minimum wage was raised in March 1997 to US$2.80 (8,500 rials). This wage apparently is not sufficient to provide a decent standard of living for a worker and family. Information on the percentage of the working population covered by minimum wage legislation is not available. Private-sector personnel in contrast are better off.

Formally, workers are granted the right to establish unions; however, the government does not allow independent unions to exist. A national organization known as the Worker's House, founded in 1982, is the sole authorized national labor organization. The leadership of the Worker's House coordinates activities with Islamic labor councils, which are made up of representatives of the workers and 1 representative of management in industrial, agricultural, and service organizations of more than 35 employees. These councils also function as instruments of government control, although they frequently have been able to block layoffs and dismissals. In 1993, the parliament passed a law that prohibits strikes by government workers. Nevertheless, strikes occur, apparently in increasing numbers. Reports over the last 2 years included strikes and protests by oil, textile, electrical manufacturing, and metal workers, and by the unemployed.

One unforeseen result of the revolutionary government's drive for gender segregation has been the improvement in women's education. As men and woman are expected to work separately, the demand for female professionals has risen markedly, boosting the number of female graduates. The war effort contributed to this process, as women took the places of men required for military service. In 2000, there were more women enrolled in universities than men. In tertiary education, vocational subjects such as computer studies and engineering are becoming increasingly popular, while the quality of language tuition is improving. These trends will undoubtedly improve the qualifications of the local population from the point of view of foreign investors, but they also present the government with higher demands for skilled job-creation and increase the pressure to cut bureaucratic and ideological obstacles to a free labor market.

COUNTRY HISTORY AND ECONOMIC DEVELOPMENT

4000 B.C. Ancient settlements develop in the Caspian region and on the Iranian plateau.

2000 B.C. Aryans arrive and split into the Medes and the Persians.

550 B.C. Cyrus the Great founds the Persian Empire.

200 A.D. After periods of Greek and Parthian rule, the Sassanids take power and rule until the Arab final victory in 641.

1502. The Safavid dynasty is established and continues to rule until 1736.

1904. The Qajar dynasty, founded by Fath Ali Shah, comes to an end.

1906-08. Iran's modern history begins when the Constitutional Movement achieves the declaration of a constitution and the establishment of a parliament in 1906 and when oil is discovered in 1908.

1919. The country is occupied by Russia and Great Britain during World War I; it signs a trade agreement with Great Britain in 1919, in which Britain formally re-affirms Iran's independence.

1921. After Iranian recognition of the USSR, the Soviet Union withdraws occupation forces from Iranian territory; Reza Khan, an army officer, establishes military rule and subsequently becomes shah in 1925 and founder of the new Pahlevi dynasty.

1941. Iran is occupied by British and Soviet forces at the start of World War II, prompting the shah to abdicate in favor of his son, Muhammad Reza Shah Pahlevi.

1943-46. Iran is formally guaranteed independence by the United States, Great Britain, and the Soviet Union in 1943; however, political instability delays the withdrawal of troops until 1946.

1951-53. The National Front Movement under Prime Minister Mossadeq nationalizes the oil business and forms the National Iranian Oil Company (NIOC); Mossadeq is subsequently ousted from power with the help of U.S. covert activity, and an international consortium operates Iran's oil facilities, with profits shared equally between Iran and the consortium.

1960-73. The shah's modernization program—named the "white revolution"—transforms the country and its economy, with a dramatic land reform, huge investments in infrastructure, and continued economic growth.

1973. The shah gives the NIOC full control over Iran's oil industry, placing the international consortium in an advisory capacity. Iran does not participate in the Arab oil embargo in September.

1979. After years of political repression and with a growing divide between rich and poor, popular protests oust the shah in the Islamic Revolution of 1979. Ayatollah Khomeini becomes the figurehead of the revolution and subsequently the Supreme Leader of the country until his death in 1989.

1980. On 22 September, Iraqi troops invade Iran, triggering a prolonged and devastating war that lasts until Khomeini accepts a UN-brokered cease-fire in July 1988.

1989. The Ayatollah Khomeini is succeeded by Iran's president, Ali Khamenei. Ali Akbar Rafsanjani becomes president and is re-elected in 1993. Iran begins to re-build its economy.

1997. Mohammed Khatami, a moderately liberal Muslim cleric, is elected president and becomes the figure-head for the country's reformist movement; economic reforms begun under Rafsanjani continue.

FUTURE TRENDS

The Iranian government has set itself the priority of achieving political reform, believing that its victory over conservative forces in the February 2000 parliamentary elections gives it the authority to deal with what President Khatami has described as Iran's "sick economy." Despite good intentions, President Mohammed Khatami has done little to change the overall pattern of Iran's macroeconomic policy. While many observers hoped that the new president would speed up the reform process, he has been bothered by entrenched political opposition in the Majlis (parliament) and pressure from the powerful bonyad (religious foundations) and by external debt repayments. Pending the outcome of the political battle, the government has to deal in the short term with a chronically weak currency, high unemployment, and the arrival of 800,000 young people on the job market every year. The lack of economic opportunities and social freedom has led to growing discontent, especially among young Iranians, and may result in extended civil unrest and an increase in emigration. Returns in the June 2001 presidential election gave President Khatami the thumping victory which is needed to revive the economic, political, and social reform process.

A key factor in Iran's economic prospects is whether the country will be able to break its international isolation which will have to be overcome in order to integrate the country into the world economy and to bring much-needed foreign investment into the Islamic Republic. This depends in particular on the lifting of U.S. sanctions. Signals show that Iran's rehabilitation is a desired U.S. objective if the reformists carry out their agenda. Iran's further international and domestic economic progress, therefore, depends in large part on the outcome of the political contest between reformers and conservatives in Tehran. Economic development will also depend on the success of privatizing enterprises in the inefficient state sector, to which about 60 percent of the current budget expenditure is allocated in subsidies and other support. Finally, to have the financial means to cope with needed reforms Iran will try to keep oil prices stable on a high level.

DEPENDENCIES

Iran has no territories or colonies.

BIBLIOGRAPHY

Amid, Mohammad Javad. Poverty, Agriculture, and Reform in Iran. London: Routledge, 1990.

Ansari, Sarah. Women, Religion and Culture in Iran. Richmond, Virginia: Curzon, 2001.

Daniel, Elton L. The History of Iran. Westport, CT: Greenwood Press, 2001.

Economist Intelligence Unit. Country Profile: Iran. London: Economist Intelligence Unit, 2001.

Esposito, John L., and R. K. Ramazani. Iran at the Crossroads. Basingstoke: Palgrave, 2001.

Iqbal, Zubair, et al. Iran: Recent Economic Developments. IMF Staff Country Report 00/120, September 2000.

Parsa, Misagh. Social Origins of the Iranian Revolution. New Brunswick, NJ: Rutgers Univ. Press, 1989.

Parvin, Alizadeh. The Economy of Iran. London: I.B. Tauris, 2000.

U.S. Central Intelligence Agency. World Factbook 2000. <http:// www.odci.gov/cia/publications/factbook/index.html>. Accessed August 2001.

—Markus R. Bouillon

Ralph Stobwasser

CAPITAL:

Tehran.

MONETARY UNIT:

Iranian rial (IR). One Iranian rial equals 100 dinars. There are coins of 1, 5, 10, 20, and 50 rials and notes of 100, 200, 500, 1,000, 2,000, 5,000, and 10,000 rials.

CHIEF EXPORTS:

Petroleum (80 percent), carpets, fruits, nuts, hides, steel.

CHIEF IMPORTS:

Machinery, military supplies, metal works, foodstuffs, pharmaceuticals, technical services, refined oil products.

GROSS DOMESTIC PRODUCT:

US$347.6 billion (purchasing power parity, 1999 est.).

BALANCE OF TRADE:

Exports: US$12.2 billion (f.o.b., 1998). Imports: US$13.8 billion (f.o.b.,1998).

Iran

Culture Name

Iranian, Persian

Alternative Names

The term "Persian" is used as an adjective— especially pertaining to the arts—and to designate the principal language spoken in Iran. The term is often used to designate the larger cultural sphere of Iranian civilization. This includes populations living in Iraq, the Persian Gulf region, the Caucasus region, Central Asia, Afghanistan, Pakistan, and northern India. The formal name of the Iranian state is Jomhuri-ye Islami-ye Iran, the Islamic Republic of Iran.

Orientation

Identification. The terms "Iran" as the designation for the civilization, and "Iranian" as the name for the inhabitants occupying the large plateau located between the Caspian Sea and the Persian Gulf have been in continual use for more than twenty-five hundred years. They are related to the term "Aryan" and it is supposed that the plateau was occupied in prehistoric times by Indo-European peoples from Central Asia. Through many invasions and changes of empire, this essential designation has remained a strong identifying marker for all populations living in this region and the many neighboring territories that fell under its influence due to conquest and expansion.

Ancient Greek geographers designated the territory as "Persia" after the territory of Fars where the ancient Achamenian Empire had its seat. Today as a result of migration and conquest, people of Indo-European, Turkic, Arab, and Caucasian origin have some claim to Iranian cultural identity. Many of these peoples reside within the territory of modern Iran. Outside of Iran, those identifying with the larger civilization often prefer the appellation "Persian" to indicate their affinity with the culture rather than with the modern political state. This is also true of some members of modern Iranian émigré populations in the United States, Europe, and elsewhere who do not wish to be identified with the current Islamic Republic of Iran, established in 1979.

Location and Geography. Iran is located in southwestern Asia, largely on a high plateau situated between the Caspian Sea to the north and the Persian Gulf and the Gulf of Oman to the south. Its area is 636,300 square miles (1,648,000 square kilometers). Its neighbors are, on the north, Azerbaijan, Armenia, and Turkmenistan; on the east, Pakistan and Afghanistan; and on the west Turkey and Iraq. Iran's total boundary is 4,770 miles (7,680 kilometers). Approximately 30 percent of this boundary is seacoast. The capital is Tehran (Teheran).

Iran's central plateau is actually a tectonic plate. It forms a basin surrounded by several tall, heavily eroded mountain ranges, principally the Elburz Mountains in the north and the Zagros range in the west and south. The geology is highly unstable, creating frequent earthquakes. Several important volcanoes, including Mount Damāvand, the nation's highest peak at approximately 19,000 feet, (5,800 meters) also ring the country.

The arid interior plateau contains two remarkable deserts: the Dasht-e-Kavir (Kavīr Desert) and the Dasht-e-Lut (Lūt Desert). These two deserts dominate the eastern part of the country, and form part of an arid landscape extending into Central Asia and Pakistan.

Iran's climate is one of extremes, ranging from subtropical to subpolar, due to the extreme variations in altitude and rainfall throughout the nation. Temperatures range from as high as 130 degrees Fahrenheit (55 degrees Celsius) in the southwest and along the Persian Gulf coast to -40 degrees Fahrenheit (-40 degrees Celsius). Rainfall varies from less than two inches (five centimeters) annually in Baluchistan, near the Pakistani border, to more than eighty inches (two hundred centimeters) in the subtropical Caspian region where temperatures rarely fall below freezing.

Demography. Iran's population has not been accurately measured since the Islamic Revolution of 1979. Recent population estimates range from sixty-one to sixty-five million. The population is balanced (51 percent male, 49 percent female), extremely young, and urban. More than three-quarters of Iran's habitants are under thirty years of age, and an equal percentage live in urban areas. This marks a radical shift from the mid-twentieth century when only 25 percent lived in cities.

Iran is a multiethnic, multicultural society as a result of millennia of migration and conquest. It is perhaps easiest to speak of the various ethnic groups in the country in terms of their first language. Approximately half of the population speaks Persian and affiliated dialects as their primary language. The rest of the population speaks languages drawn from Indo-European, Ural-Altaic (Turkic), or Semitic language families.

The principal non-Persian Indo-European speakers include Kurds, Lurs, Baluchis, and Armenians, making up approximately 15 percent of the population. Turkic speakers constitute approximately 20 to 25 percent of the population. The largest group of Turkic speakers lives in the northwest provinces of East and West Azerbaijan. Other Turkic groups include the Qashqa'i tribe in the south and southwest part of the central plateau, and the Turkmen in the northeast. Semitic speakers, constituting approximately 10 percent of the population, include a large Arabic-speaking population in the extreme southwest province of Khuzestan, and along the Persian Gulf Coast, and a small community of Assyrians in the northwest, who speak Syriac. The remains of a miniscule community of Dravidian speakers lives in the extreme eastern province of Sistan along the border with Afghanistan.

It is important to note that, with some minor exceptions, all ethnic groups living in Iran, whatever their background or primary language, identify strongly with the major features of Iranian culture and civilization. This also applies to many non-Iranians living in Afghanistan, Central Asia, northern India, and parts of Iraq and the Persian Gulf region.

Linguistic Affiliation. In English, "Persian" is the name for the primary language spoken in Iran. It is incorrect, but increasingly common in English-speaking countries to use the native term, "Farsi," to identify the language. This is somewhat akin to using "Deutsch" to describe the principal language of Germany.

Modern Persian, a part of the Indo-Iranian branch of the Indo-European languages, is a language of great antiquity. It is also a language of extraordinary grace and flexibility. Over many centuries, it absorbed Arabic vocabulary and many Turkish elements, swelling its vocabulary to well over 100,000 commonly used words. At the same time, over the many centuries when Arabic was dominant, Persian lost much of its grammatical complexity. The resulting language is mellifluous, easy to learn, and ideally suited for the unsurpassed poetry and literature Iranians have produced over the ages. The language is remarkably stable; Iranians can read twelfth century literature with relative ease.

The majority of Iranian residents whose first language is not Persian are bilingual in Persian and their primary language. Persons whose first language is Persian are usually monolingual.

Symbolism. Iranian culture is rich in cultural symbolism, much of which derives from prehistoric times. Iran is the only nation in the Middle East that uses the solar calendar. It is also the only nation on earth marking the advent of the New Year at the spring equinox.

The Islamic and the pre-Islamic world have both provided national symbols for Iran, and these have come in conflict in recent years. Mohammad Reza Pahlavi, the shah who was deposed in 1979, tried to make the twenty-five-hundred-year-old monarchy itself a central symbol of Iranian life. He designed a series of lavish public celebrations to cement this image in the public imagination. The ancient emblem for the nation was a lion holding a scimitar against a rising sun. This emblem was a symbol not only of Iran, but also of the ancient monarchy, and was prominently displayed on the national tricolor flag of red, white, and green. The Persian lion is now extinct, and since the 1979 Revolution, so is this emblem. It has been replaced by a nonfigurative symbol that can be construed as a calligraphic representation of the basic Islamic creed, "There is no god but God." The tricolor background has been maintained.

Much symbolism in daily life derives not just from Islam, but from the "Twelver" branch of Shi'a Islam that has been the official state religion since the seventeenth century. It is essential to note the central symbolic importance of Imam Hassain, the grandson of the prophet Muhammad, who was martyred in Karbala in present-day Iraq during the Islamic month of Muharram in the seventh century. His martyrdom is a "master symbol" in Iranian life, serving as an inexhaustible source of imagery and rhetoric.

History and Ethnic Relations

Emergence of the Nation. The Iranian nation is one of the oldest continuous civilizations in the world. Upper Paleolithic and Mesolithic populations occupied caves in the Zagros and Elburz mountains. The earliest civilizations in the region descended from the Zagros foothills, where they developed agriculture and animal husbandry, and established the first urban cultures in the Tigris-Euphrates basin in present day Iraq. The earliest urban peoples in what is today Iranian territory were the Elamites in the extreme southwest region of Khuzestan. The arrival of the Aryan peoples—Medes and Persians— on the Iranian plateau in the first millennium b.c.e. marked the beginning of the Iranian civilization, rising to the heights of the great Achaemenid Empire consolidated by Cyrus the Great in 550 b.c.e. Under the rulers Darius the Great and Xerxes, the Achaemenid rulers extended their empire from northern India to Egypt.

Down to the present, one pattern has repeated again and again in Iranian civilization: the conquerors of Iranian territory are eventually themselves conquered by Iranian culture. In a word, they become Persianized.

The first of these conquerors was Alexander the Great, who swept through the region and conquered the Achaemenid Empire in 330 b.c.e. Alexander died shortly thereafter leaving his generals and their descendants to establish their own subempires. The process of subdivision and conquest culminated in the establishment of the entirely Persian Sassanid Empire at the beginning of the third century c.e. The Sassanians consolidated all territories east to China and India, and engaged successfully with the Byzantine Empire.

The second great conquerors were the Arab Muslims, arising from Saudi Arabia in 640 c.e. They gradually melded with the Iranian peoples, and in 750, a revolution emanating from Iranian territory assured the Persianization of the Islamic world through the establishment of the great Abbassid Empire at Baghdad. The next conquerors were successive waves of Turkish peoples starting in the eleventh century. They established courts in the northeastern region of Khorassan, founding several great cities. They became patrons of Persian literature, art, and architecture.

Successive Mongol invasions of the thirteenth century resulted in a period of relative instability culminating in a strong reaction in the early sixteenth century on the part of a resurgent religious movement—the Safavids. The Safavid rulers started as a religious movement of adherents of Twelver Shi'ism. They established this form of Shi'ism as the Iranian state religion. Their empire, which ranged from the Caucasus to northern India, raised Iranian civilization to its greatest height. The Safavid capital, Isfahan, was by all accounts one of the most civilized places on earth, far in advance of most of Europe.

Subsequent conquests by the Afghans and the Qājār Turks had the same result. The conquerors came and became Persianized. During the Qājār period from 1899 to 1925, Iran came into contact with European civilization in a serious way for the first time. The industrial revolution in the West seriously damaged Iran's economy, and the lack of a modern army with the latest in weaponry and military transport resulted in serious losses of territory and influence to Great Britain and Russia. Iranian rulers responded by selling "concessions" for agricultural and economic institutions to their European rivals to raise the funds needed for modernization. Much of the money went directly into the pockets of the Qājaār rulers, cementing a public image of collaboration between the throne and foreign interests that characterized much of twentieth century Iranian political life. A series of public protests against the throne took place at regular intervals from the 1890s to the 1970s. These protests regularly involved religious leaders, and continued throughout the reign of the Pahlavi dynasty (1925–1979). These protests culminated in the Islamic Revolution of 1978–1979, hereafter referred to as "the Revolution."

National Identity. The establishment of the theocratic Islamic Republic of Iran under Ayatollah Ruhollah Khomeini marked a return to religious domination of Iranian culture. Khomeini's symbols were all appropriately appealing to Iranian sensibilities as he called on the people to become martyrs to Islam like Hasan, and restore the religious rule of Hasan's father, Ali, the last leader of both Sunni and Shi'a Muslims. Now, more than twenty years after the Revolution and following Khomeini's death, Iran is once again undergoing change. Its youthful population is demanding liberalization of the strict religious rule of its leaders, and a return to the historic balance of religion and secularism that has characterized the nation for most of its history.

Ethnic Relations. Iran has been somewhat blessed by an absence of specific ethnic conflict. This is noteworthy, given the large number of ethnic groups living within its borders, both today and in the past. It is safe to conclude that the general Iranian population neither persecutes ethnic minorities, nor openly discriminates against them.

Some groups living within Iranian borders do assert autonomy occasionally, however. Chief among these are the Kurds, living on Iran's western border. Fiercely independent, they have pressed the Iranian central government to grant economic concessions and autonomous decision-making powers. However, outside of the urban areas in their region, the Kurds already have formidable control over their regions. Iranian central government officials tread very lightly in these areas. The Kurds in Iran, along with their brethren in Iraq and Turkey, have long desired an independent state. The immediate prospects for this are dim.

The nomadic tribal groups in the southern and western regions of the Iranian central plateau have likewise caused problems for the Iranian central government. Because they are in movement with their sheep and goats for more than half of the year, they have historically been difficult to control. They are also generally self-sufficient, and a small minority are even quite well-off. Attempts to settle these tribes in the past have met with violent action. At present they entertain an uneasy peace with Iranian central authorities.

The Arab population of the southwestern trans-Zagros Gulf province of Khuzestan has entertained political aspirations of breaking away from Iran. These aspirations have been encouraged by Iraq and other Arab states. In times of conflict between Iran and Iraq, Iraqi leaders have supported this separatist movement as a way of antagonizing Iranian officials.

The severest social persecution in Iran has been directed at religious minorities. Periods of relative tolerance have alternated with periods of discrimination for centuries. Under the current Islamic republic, these minorities have had a difficult time. Although theoretically protected as "People of the Book" according to Islamic law, Jews, Christians, and Zoroastrians have faced accusations of spying for Western nations or for Israel. Islamic officials also take a dim view of their tolerance of alcohol consumption, and the relative freedom accorded to women. The one group that has been universally persecuted since its nineteenth century founding is the Baha'i community, because its religion is viewed as heretical by Shi'a Muslims.

Urbanism, Architecture, and the Use of Space

Until recently Iran was primarily a rural culture. Even today with rampant urbanization, Iranians value nature and make every attempt to spend time in the open air. Because Iran is largely a desert, however, the ideal open space is a culturally constructed space—a garden. At the same time Iranians will try to bring the outdoors inside whenever possible. The wonderfully intricate carpets that every family strives to own are miniature gardens replete with flower and animal designs. Fresh fruit and flowers are a part of every entertainment, and nature and gardens are central themes in literature and poetry.

This underscores a fascinating central motif in Iranian architecture—the juxtaposition of "inside" and "outside." These two concepts are more than architectural themes. They are deeply central to Iranian life, pervading spiritual life and social conduct. The inside, or andaruni, is the most private, intimate area of any architectural space. It is the place where family members are most relaxed and able to behave in the most unguarded manner. The outside, or biruni, is by contrast a public space where social niceties must be observed. Every family creates both kinds of spaces, even if living in a single room. Until the nineteenth century, Iranians did not use chairs. They normally sat cross-legged on the floor, preferably on a carpet with bolsters or pillows. In the twentieth century, furniture became the hallmark of the biruni, and now every family of any standing has a room stuffed with uncomfortable furniture for receiving important visitors. When the guests leave, family members give a sigh of relief and go to the andaruni where they can relax on the plush carpet.

An Iranian home is one where any room, with the exception of those used for cooking and bodily functions, can be used for any social purpose— eating, sleeping, entertainment, business, or whatever else one can conceive. One spreads a dinner cloth, and it is a dining room. After dinner, the cloth is removed, cotton mattresses are spread, and the room becomes a bedchamber. Contrast this to an American home where each room has specific functions, or is designated the specific territory of a given family member. As a result, Iranian families can live and entertain many guests in much less space than in the West. This is a social necessity, since the members of one's extended family, and even their friends and acquaintances, have an ironclad claim on virtually unlimited hospitality. One must be prepared to entertain many overnight guests at a moment's notice.

In addition to intimacy, the notion of the andaruni pertains to modesty for women. This is a consideration in all public arrangement of space, especially since the advent of the Islamic Republic. Some zealots will not allow men to sit on a spot that is still warm from a woman's presence. By contrast, public space occupied by persons of the same sex can be very close and intimate with no hint of eroticism or immodesty.

The historical Iranian city is constructed around the commercial center—the bazaar. Architect Nader Ardalan has likened the city to the human body. The bazaar is the spine of the city. Emanating from it are all the institutions needed by the urban population. At the top of the bazaar sits the "head" of this body—the great congregational mosque where all citizens gather on Friday for common prayers and perhaps a sermon. The bazaar is divided into sections inhabited by the various trade guilds. Thus all the carpenters are in one section, the goldsmiths in another, and the shoemakers in yet another.

The bazaar is punctuated with the "outside brought inside" in the form of pools and running water, and even perhaps a religious school with a small garden. The urban space surrounding the bazaar is likewise punctuated by the "inside brought outside" in the form of enclosed public gardens for private discourse in public. Houses in residential neighborhoods are built with abutting walls, each home having its bit of the outside in the form of an open courtyard with a pool, and a tree and a few flowers or a kitchen garden.

In the twentieth century, however, the needs of modern motor transportation and increased urban population density have destroyed much of the texture of the traditional city. Wide avenues have been cut through the traditional quarters in almost every city, disrupting the integrity of the old neighborhoods. Faceless apartment buildings have sprung up depriving residents of their gardens, save for a pot or two of flowers on a small balcony.

Public architecture has always been the essence of biruni in Iran. Grandiose in style, it almost demands formal social behavior. This has been true since Achaemenid times, as a visit to the ruins of their capital, Persepolis, will attest. The grandiose public mosques, shrines, and squares of Isfahan, Mashhad, Shīrāz, and Qom are overwhelming in their beauty and architectural excellence. Unfortunately, the great public buildings of Tehran built in the twentieth century have the bad fortune to have been built to emulate the most stark Western architectural styles.

Food and Economy

Food in Daily Life. As one might expect from Iran's geographic situation, its food strikes a medium between Greek and Indian preparations. It is more varied than Greek food, and less spicy and subtler than Indian food with a greater use of fresh ingredients.

Iranians have a healthy diet centered on fresh fruits, greens and vegetables. Meat (usually lamb, goat, or chicken) is used as a condiment rather than as the centerpiece of a meal. Rice and fresh unleavened or semileavened whole-grain bread are staple starches. The primary beverage is black tea. The principal dietary taboo is the Islamic prohibition against pork.

Breakfast is a light meal consisting of fresh unleavened bread, tea, and perhaps butter, white (feta-style) cheese, and jam. Eggs may also be eaten fried or boiled. Meat is not common at breakfast.

The main meal of the day is eaten at around one o'clock in the afternoon. In a middle-class household it usually starts with a plate of fresh greens— scallions, radishes, fresh basil, mint, coriander, and others in season. This is served with unleavened bread and white cheese. The main dish is steamed aromatic rice (chelow ) served with one or more stews made of meat and a fresh vegetable or fruit. This stew, called khoresht resembles a mild curry. It centers on a central ingredient such as eggplant, okra, spinach, quince, celery, or a myriad of other possibilities. One particularly renowned khoresht, fesenjun, consists of lamb, chicken, duck, or pheasant cooked in a sauce of onions, ground walnuts, and pomegranate molasses. In addition to its preparation as chelow, rice may also be prepared as a pilaf (polow ) by mixing in fresh herbs, vegetables, fruit, or meat after it is boiled, but before it is steamed.

The Iranian national dish, called chelow kabab, consists of filet of lamb marinated in lemon juice or yogurt, onions, and saffron, pounded with a knife on a flat skewer until fork tender and grilled over a hot fire. This is served with grilled onions and tomatoes on a bed of chelow to which has been added a lump of butter and a raw egg yolk. The butter and egg are mixed with the hot rice (which cooks the egg), and ground sumac berries are sprinkled on top. A common drink with a meal is dough, a yogurt and salted water preparation that is similar to Turkish ayran, Lebanese lebni, and Indian lassi.

Sweets are more likely to be consumed with tea in the afternoon than as dessert. Every region of the country has special confections prized as travel souvenirs, and served casually to guests. Among the most famous are gaz, a natural nougat made with rose water, and sohan, a saffron, butter, and pistachio praline. After a meal Iranians prefer fresh fruit and tea. In fact, fruit is served before the meal, after the meal—indeed, at any time.

The evening meal is likely to be a light meal consisting of leftover food from the noon meal, or a little bread, cheese, fruit, and tea. Urban dwellers may eat a light meal at a café or restaurant in the evening.

Outside of large cities, restaurants are not very common in Iran. On the other hand, teahouses are ubiquitous, and widely frequented at all times of day. One can always get some kind of meal there.

Alcoholic beverages are officially forbidden in Iran today under the Islamic republic, but their consumption is still widely practiced. Armenian, Jewish, and Zoroastrian communities still produce wine, and local moonshine is found everywhere in rural areas. The principal alcoholic beverage is "vodka" distilled from grain, grapes, or more commonly, raisins. It is consumed almost exclusively by men in the evening or at celebrations such as weddings.

Food Customs at Ceremonial Occasions. Ritual foods fall into two categories—foods that are eaten in celebration, and foods that are prepared and consumed as a charitable religious act.

A few foods are traditional for the New Year's celebration. Fish is widely consumed as the first meal of the New Year, along with a polow made with greens. One food appears on the ritual New Year's table, but is rarely eaten. This is a kind of sweet pudding made of ground sprouted wheat called samanou.

During the Islamic month of fasting, Ramadan, no food or drink is consumed from sunrise to sunset. Families rise before dawn to prepare heavy breakfasts that look like the noon meal. The process is repeated at sundown. Special crispy fried sweets made from a yogurt batter and soaked in syrup are frequently served. Two forms are popular: zulbia, which looks a bit like a multi stranded pretzel, and bamieh, which looks a bit like the okra pods it is named after.

Food is frequently prepared for distribution to the community as a charitable religious act. When a sheep is slaughtered for a special occasion it is common to give meat to all of one's neighbors. To give thanks for fulfillment of a desire, a community meal is frequently prepared. Likewise, during the mourning ceremonies for Hossein during the months of Muharram and Safar, communal meals are paid for by charitable individuals. The most common food served on these occasions is a polow made with yellow peas and meat.

Basic Economy. Historically Iran has been an agricultural nation with fairly rich resources both for vegetable crops and animal husbandry. In the twentieth century, Iran's economy changed in a radical fashion due to the discovery of oil. By the time of the Revolution the nation received more than 80 percent of its income from oil and oil-related industry. While in 1955 more than 75 percent of the population lived in rural areas, distribution has reversed. Now more than 75 percent of Iranians live in urban areas, deriving their incomes either from manufacturing or from the service sector (currently the largest sector of the economy).

The goals of the Islamic Republic include a drive for self-sufficiency in food and manufacture. At present, however, only about 10 percent of the nation's agricultural land is under cultivation, and subsistence farming is all but dead. Iran remains a net importer of food and manufactured goods, a condition that will not change soon. Inflation is a continual problem. Were it not for oil income, the nation would be in difficult straits.

Land Tenure and Property. Absentee landlords in Iran held traditional agricultural land for many hundreds of years. They employed a sharecropping arrangement with their tenant farmers based on a principle of five shares: land, water, seed, animal labor, and human labor. The farmer rarely supplied more than human and animal labor, and thus received two-fifths of the produce. Additionally landlords hired some agricultural laborers to work land for them for direct wages.

Sharecropping farmers received the land they farmed in the land reform movements of the 1960s and 1970s, but the wage farmers received nothing, and largely abandoned agricultural pursuits.

Nomadic tribes claim grazing rights along their route of migration, with the rights parceled out by family affiliation. Government officials have contested and opposed these rights at various times on environmental grounds (overgrazing), but they have not been able marshal effective enforcement. Tribal members also maintain agricultural land both at their summer and winter pasture headquarters.

Religious bequest (waqf ) land plays a large role in Iranian life. Large landowners on their death have willed whole villages as well as other kinds of property to the religious bequest trust. Nearly the entire city of Mashhad is waqf land. Individuals in that city can buy houses and office buildings, but not the land on which they stand. Part of the strategic plan of the Pahlavi rulers was to break the economic power of the clergy who controlled this vast property by nationalizing it, and placing its administration under a government ministry. This was one of the government actions most vehemently opposed by the clergy before the Revolution. Nevertheless, the waqf is still administered by a government ministry.

Major Industries. Iran today has a steel plant, automobile and bus assembly plants, a good infrastructure of roads, a decent telecommunication system, and good broadcast facilities for radio and television. These have all been extended under the Islamic Republic, as has rural electrification. Mining and exploitation of Iran's extensive mineral wealth other than oil is largely moribund. Moves to privatize industry have been slow; 80 percent of all economic activity is under direct government control.

Trade. Aside from oil products, the nation's exports include carpets, caviar, cotton, fruits, textiles, minerals, motor vehicles, and nuts. A small amount of fresh produce and meat is exported to the states of the Persian Gulf.

Social Stratification

Classes and Castes. Iranian society presents a puzzle for most standard social science analysis of social structure. On the one hand there is an out-ward appearance of extensive social stratification. When one peers beneath the surface, however, this impression breaks down almost immediately.

In Iran one can never judge a book by its cover. A traditional gentleman in ragged clothes, unshaven, and without any outward trapping of luxury may in fact be very rich, and as powerful as the mightiest government official; or he may be a revered spiritual leader. On the other hand a well-dressed gentleman in an Italian suit driving a fine European car may be mired in debt and openly derided behind his back.

Social mobility is also eminently possible in Iran. Clever youths from poor backgrounds may educate themselves, attach themselves to persons of power and authority, and rise quickly in status and wealth. Family connections help here, and hypergamy (marriage into a higher class) for both men and women is very important.

High status is precarious in Iran. There is a symbiotic relationship between superior and inferior. Duty is incumbent on the inferior, but the noblesse oblige incumbent on the superior as a condition of maintaining status is often greater, as the last shah, Mohammad Reza Pahlavi, discovered in the Revolution.

Nevertheless there are genuinely revered figures in public life. Public respect is largely accorded by diffuse and generalized acclimation, this being a form of status recognition that Iranians trust. The public has a tendency to dismiss awards, promotions, and public accolades as the result of political or social intriguing. The clerical hierarchy in Shi'a Islam is a good model for genuine advancement in social hierarchy because clerics advance through the informal acknowledgment of their peers.

Political Life

Government. Iran has made the transition in the last twenty years from a nominal constitutional monarchy to a democratic theocracy. As the United States has checks and balances in its governmental system, so does Iran. There is a strong president elected for a four-year term, and a unicameral legislature (majles ) of 270 members, elected directly by the people, with some slots reserved for recognized minorities. The position of speaker is politically important, since there is no prime minister. Suffrage is universal, and the voting age is sixteen. The president selects a Council of Ministers, an Expediency Council, and serves as the head of the Council of National Security.

Over and above these elected bodies there is a supreme jurisprudent selected by an independent Assembly of Experts—a council of religious judges. The office of chief jursiprudent (faqih ) was created for Ayatollah Ruhollah Khomeini at the time of the Revolution. It was designed to implement a controversial philosophy unique to Khomeini's teachings—a "guardianship" to be implemented until the day of return of the twelfth Shi'a Imam, Muhammad al-Mahdi, who is in occultation (being hidden from view). Alongside the chief jurisprudent is a twelve-member Council of Guardians, six selected by the chief jurisprudent, and six by the Supreme Judicial Council ratified by the majles. The Council of Guardians rules on the Islamic suitability of both elected officials and the laws they pass. They can disqualify candidates for election both before and after they are elected. Another council mediates between the Council of Guardians and the legislature.

The judiciary consists of a Supreme Judge and a Supreme Judicial Council. All members must be Shi'a Muslim jurisprudents. Islamic Shari'a law is the foundation for the court's decisions. Freedom of the press and assembly are constitutionally guaranteed so long as such activities do not contradict Islamic law.

The units of governmental division are the province (ostan ), "county" (sharestan ), and township (dehestan ). Each governmental unit has a head appointed by the Ministry of the Interior.

Military Activity. Although there is a standing army, navy, and air force, the Revolutionary Guards (Pasdaran-e Engelab ), organized shortly after the Revolution, dominate military activities, often coming into conflict with the standard military forces. The Revolutionary Guards either accompany or lead all military activities, both internal and international. A national police force oversees urban areas, and a gendarmerie attends to rural peacekeeping.

Social Welfare and Change Programs

The Islamic Republic of Iran is replete with charitable organizations. It is incumbent upon all Muslims to devote a proportion of their excess income to the support of religious and charitable works. This contribution is voluntary, but the government collects this tithe and uses the income to support hospitals, orphanages, and religious schools. The government is also committed to rural development projects. A movement called the "sacred development struggle" (jihad-e sazandegi ) was launched early in the Islamic Republic and was successful in bringing important development projects—electrification, drinking water and roads—to remote rural areas. There are many small private charitable organizations organized to help the poor, fatherless families, children, and other unfortunate citizens. The Iranian Red Crescent Society (the local version of the Red Cross) is active and important in the instance of national disaster. Iran is a net exporter of charity to neighboring countries. It has assisted with disaster relief in Central Asia, the Caucasus, Lebanon, and the Persian Gulf region.

Nongovernmental Organizations and Other Associations

There are very few international nongovernmental organizations (NGOs) operating independent development or health programs in Iran at present, except in conjunction with Iranian governmental organizations. The current regime views independent NGOs with deep suspicion, and in its aim for self-sufficiency views the work of many international charities as unnecessary. The United Nations (UN) is the one important exception. Iran has supported the UN since its inception, and a number of UN programs in health, development, population, and the preservation of cultural antiquities are active. The nation's Mostazafin ("downtrodden people") Foundation and the Imam Khomeini Foundation have operated in the international sphere.

Gender Roles and Statuses

The Relative Status of Women and Men. The question of gender roles is one of the most complex issues in contemporary Iranian society. Women have always had a strong role in Iranian life, but rarely a public role. Their prominent participation in political movements has been especially noteworthy. Brave and often ruthlessly pragmatic, women are more than willing to take to the streets for a good public cause. Moreover, although the world focuses increasingly on the question of female dress as an indicator of progress for women in Iran (and indeed, in the Islamic world altogether), this is a superficial view. In the years since the Revolution, women have made astonishing progress in nearly every area of life.

Both the Pahlavi regime and the leaders of the Islamic Republic have gone out of their way to emphasize their willingness to have women operate as full participants in government and public affairs. Women have served in the legislature and as government ministers since the 1950s. The average marriage age for women has increased to twenty-one years. Iran's birthrate has fallen steadily since before the Revolution, now standing at an estimated 2.45 percent. Education for women is obligatory and universal, and education for girls has increased steadily. The literacy rate for women is close to that of men, and for women under 25 it is over 90 percent, even in rural areas.

Female employment is the one area where women have suffered a decline since the Revolution. Even under the current Islamic regime, virtually all professions are theoretically open to women—with an important caveat. The difficulty for the leaders of the Islamic republic in allowing women complete equality in employment and public activity revolves around religious questions of female modesty that run head-to-head with the exigencies of public life. Islam requires that both women and men adopt modest dress that does not inflame carnal desire. For men this means eschewing tight pants, shorts, short-sleeved shirts, and open collars. Iranians view women's hair as erotic, and so covering both the hair and the female form are the basic requirements of modesty. For many centuries women in Iran have done this by wearing the chador, a semicircular piece of dark cloth that is wrapped expertly around the body and head, and gathered at the chin. This garment is both wonderfully convenient, since it affords a degree of privacy, and lets one wear virtually anything underneath; and restricting, since it must be held shut with one hand. Makeup of any kind is not allowed. In private, women dress as they please, and often exhibit fashionable, even daring, clothing for their female friends and spouses.

Any public activity that would require women to depart from this modest dress in mixed company is expressly forbidden. Professions requiring physical exertion outdoors are excluded, as are most public entertainment roles. Interestingly, film and television are open to women provided they observe modest dress standards. This has created an odd separate-but-equal philosophy in Iranian life. Some activities, such as sports events, have been set up for exclusively female participants and female spectators.

Westernized Iranian women have long viewed obligatory modest dress in whatever forms as oppressive, and have worked to have standards relaxed. These standards certainly have been oppressive when forced on the female population in an obsessive manner. Revolutionary Guards have mutilated some women for showing too much hair or for wearing lipstick. But the majority of women in Iran have always adopted modest dress voluntarily, and will undoubtedly continue to do so in the future no matter what political decisions are made on this matter.

The emotional roles of Iranian men and women are different from those in the United States and many other Western countries. In particular, it is considered manly for men to be emotionally sensitive, artistically engaged, and aesthetically acute. Women, by contrast, can be emotionally distant and detached without seeming unfeminine. Open weeping is not shameful for either sex. Both sexes can be excessively tender and doting toward their same-sex friends with no intention of eroticism. Kissing and hand-holding between members of the same sex is common.

By contrast, physical contact between members of the opposite sex is assiduously avoided except between relatives. Western men offering to shake a traditional Iranian woman's hand may see her struggling between a desire to be polite, and a desire not to breech standards of decency. The solution for many a woman is to cover her hand with part of her chador and shake hands that way. Under no circumstances should a proper man or woman willingly find themselves alone in a closed room with a member of the opposite sex (except for his or her spouse).

Marriage, Family, and Kinship

Marriage. In Iran women control marriages for their children, and much intrigue in domestic life revolves around marital matters. A mother is typically on the lookout for good marriage prospects at all times. Even if a mother is diffident about marriage brokering, she is obliged to "clear the path" for a marriage proposal. She does this by letting her counterpart in the other family know that a proposal is forthcoming, or would be welcome. She then must confer with her husband, who makes the formal proposal in a social meeting between the two families. This kind of background work is essential, because once the children are married, the two families virtually merge, and have extensive rights and obligations vis-á-vis each other that are close to a sacred duty. It is therefore extremely important that the families be certain that they are compatible before the marriage takes place.

Marriage within the family is a common strategy, and a young man of marriageable age has an absolute right of first refusal for his father's brother's daughter—his patrilateral parallel cousin. The advantages for the families in this kind of marriage are great. They already know each other and are tied into the same social networks. Moreover, such a marriage serves to consolidate wealth from the grandparents' generation for the family. Matrilateral cross-cousin marriages are also common, and exceed parallel-cousin marriages in urban areas, due perhaps to the wife's stronger influence in family affairs in cities.

Although inbreeding would seem to be a potential problem, the historical preference for marriage within the family continues, waning somewhat in urban settings where other considerations such as profession and education play a role in the choice of a spouse. In 1968, 25 percent of urban marriages, 31 percent of rural marriages, and 51 percent of tribal marriages were reported as endogamous. These percentages appear to have increased somewhat following the Revolution.

In Iran today a love match with someone outside of the family is clearly not at all impossible, but even in such cases, except in the most westernized families, the family visitation and negotiation must be observed. Traditional marriages involve a formal contract drawn up by a cleric. In the contract a series of payments are specified. The bride brings a dowry to the marriage usually consisting of household goods and her own clothing. A specified amount is written into the contract as payment for the woman in the event of divorce. The wife after marriage belongs to her husband's household and may have difficulty visiting her relatives if her husband does not approve. Nevertheless, she retains her own name, and may hold property in her own right, separate from her husband.

The wedding celebration is held after the signing of the contract. It is really a prelude to the consummation of the marriage, which takes place typically at the end of the evening, or, in rural areas, at the end of several days' celebration. In many areas of Iran it is still important that the bride be virginal, and the bedsheets are carefully inspected to ensure this. A wise mother gives her daughter a vial of chicken blood "just in case." The new couple may live with their relatives for a time until they can set up their own household. This is more common in rural than in urban areas.

Iran is an Islamic nation, and polygyny is allowed. It is not widely practiced, however, because Iranian officials in this century have followed the Islamic prescription that a man taking two wives must treat them with absolute equality. Women in polygynous marriages hold their husbands to this and will seek legal relief if they feel they are disadvantaged. Statistics are difficult to ascertain, but one recent study claims that only 1 percent of all marriages are polygynous.

Divorce is less common in Iran than in the West. Families prefer to stay together even under difficult circumstances, since it is extremely difficult to disentangle the close network of interrelationships between the two extended families of the marriage pair. One recent study claims that the divorce rate is 10 percent in Iran. For Iranians moving to the United States the rate is 66 percent, suggesting that cultural forces tend to keep couples from separating.

Children of a marriage belong to the father. After a divorce, men assume custody of boys over three years and girls over seven. Women have been known to renounce their divorce payment in exchange for custody of their children. There is no impediment to remarriage with another partner for either men or women.

Domestic Unit. In traditional Iranian rural society the "dinner cloth" often defines the minimal family. Many branches of an extended family may live in rooms in the same compound. However, they may not all eat together on a daily basis. Sons and their wives and children are often working for their parents in anticipation of a birthright in the form of land or animals. When they receive this, they will leave and form their own separate household. In the meantime they live in their parents' compound, but have separate eating and sleeping arrangements. Even after they leave their parents' home, members of extended families have widespread rights to hospitality in the homes of even their most distant relations. Indeed, family members generally carry out most of their socializing with each other.

Inheritance. Inheritance generally follows rules prescribed by Islamic law. Male children inherit full shares of their father's estate, wives and daughters half-shares. An individual may make a religious bequest of specific goods or property that are then administered by the ministry of waqfs.

Kin Groups. The patriarch is the oldest male of the family. He demands respect from other family members and often has a strong role in the future of young relatives. In particular it is common for members of an extended family to spread themselves out in terms of professions and influence. Some will go into government, others into the military, perhaps others join the clergy, and some may even become anti-government oppositionists. Families will attempt to marry their children into powerful families as much for their own sake as for the son or daughter. The general aim for the family is to extend its influence into as many spheres as possible. As younger members mature, older members of the family are expected to help them with jobs, introductions, and financial support. This is not considered corrupt or nepotistic, but is seen rather as one of the benefits of family membership.

Socialization

Infant Care. The role of the mother is extremely important in Iran. Mothers are expected to breast-feed their babies for fear the babies will become "remorseless."

Child Rearing and Education. Mothers and children are expected to be mutually supportive. A mother will protect her children's reputation under all circumstances. Small children are indulged, and not just by their parents. They are magnets for attention from everyone in the society. Some parents worry about their children becoming vain and spoiled, but have a difficult time denying their wishes.

Older children often raise younger children, especially in rural settings. It is very common to see an older child with full responsibility for care of a toddler. Children are usually more than up to this task, and develop strong bonds with their siblings. There is some rivalry between children in a family, but the rule of primogeniture is strong, and older children have the right to discipline younger children.

The father is the disciplinarian of the family. Whereas most fathers dote on their small children, they can become fierce and stern as children approach puberty. It is the father's responsibility to protect the honor of the family, and this means keeping close watch on the women and their activities. A girl is literally a treasure for the family. If she remains chaste, virginal, modest, and has other attributes such as beauty and education she has an excellent chance of making a marriage that will benefit everyone. If she falls short of this ideal, she can ruin not only her own life, but also the reputation of her family.

Boys are far more indulged than girls. Their father teaches them very early, however, that the protection of family honor also resides with them. It is not unusual to see a small boy upbraiding his own mother for some act that shows a lack of modesty. This is the beginning of a life long enculturation that emphasizes self-denial, collectivism, and interdependence with regard to the family.

Families place a very strong emphasis on education for both boys and girls. For girls this is a more modern attitude, but it was always true for boys. The education system relies a great deal on rote memorization, patterned as it is on the French education system. Children are also strongly encouraged in the arts. They write poetry and learn music, painting, and calligraphy, often pursuing these skills privately.

Higher Education. All Iranians would like their children to pursue higher education, and competition for university entrance is fierce. The most desired professions for children are medicine and engineering. These fields attract the best and the brightest, and graduates receive an academic social title for both professions (doktor and mohandess ). The social rewards are so great for success in these professions that families will push their children into them even if their interests lie elsewhere. Many young people receive an engineering or medical degree and then pursue a completely different career.

Etiquette

The social lubricant of Iranian life is a system known as ta'arof, literally "meeting together." This is a ritualized system of linguistic and behavioral interactional strategies allowing individuals to interrelate in a harmonious fashion. The system marks the differences between andaruni and biruni situations, and also marks differences in relative social status. In general, higher status persons are older and have important jobs, or command respect because of their learning, artistic accomplishments, or erudition.

Linguistically, ta'arof involves a series of lexical substitutions for pronouns and verbs whereby persons of lower status address persons of higher status with elevated forms. By contrast, they refer to themselves with humble forms. Both partners in an interaction may simultaneously use other-raising and self-lowering forms toward each other. Ritual greetings and leave-takings such as ghorban-e shoma (literally, "your sacrifice") underscore this sensibility.

In social situations, this linguistic gesture is replicated in behavioral routines. It is good form to offer a portion of what one is about to eat to anyone nearby, even if they show no interest. One sees this behavior even in very small children. It is polite to refuse such an offer, but the one making the offer will be sensitive to the slightest hint of interest and will continue to press the offer if it is indicated.

Guests bring honor to a household, and are eagerly sought. When invited as a guest a small present is appreciated, but often received with a show of embarrassment. It will usually not be unwrapped in front of the giver. It is always expected that a person returning from a trip will bring presents for family and friends.

An honored guest is always placed at the head of a room or a table. The highest status person also goes first when food is served. It is proper form to refuse these honors, and press them on another.

One must be very careful about praising any possession of another. The owner will likely offer it immediately as a present. Greater danger still lies in praising a child. Such praise bespeaks envy, which is the essence of the "evil eye." The parent will be alarmed, fearing for the child's life. The correct formula for praising anything is ma sha' Allah, literally, "What God wills."

Iranians can be quite physically intimate with same-sex friends, even in public. Physical contact is expected and is not erotic. In restaurants and on buses and other public conveyances people are seated much closer than in the West. On the other hand, even the slightest physical contact with non-family members of the opposite sex, unless they are very young children, is taboo.

A downward gaze in Iran is a sign of respect. Foreigners addressing Iranians often think them disinterested or rude when they answer a question without looking at the questioner. This is a cross-cultural mistake. For men, downcast eyes are a defense measure, since staring at a woman is usually taken as a sign of interest, and can cause difficulties. On the other hand, staring directly into the eyes of a friend is a sign of affection and intimacy.

In Iran the lower status person issues the first greeting. In the reverse logic of ta'arof this means that a person who wants to be polite will make a point of this, using the universal Islamic salaam or the extended salaam aleikum. The universal phrase for leave-taking is khoda hafez —"God protect."

Religion

Religion Beliefs. The state religion in Iran is Ithnaashara or Twelver Shi'ism, established by the Safavid Dynasty in the seventeenth century. This branch of Islam has many distinctive practices and beliefs that differ from the Sunni Islam practiced in most of the Muslim world. Shi'a Muslims revere the descendants of Fatimah, daughter of the prophet Muhammad, and her husband, Ali, Muhammad's cousin. There are twelve Imams recognized by this branch of Shi'ism. All were martyred except the twelfth, Muhammad al-Mahdi, who disappeared, but will return at the end of time with Jesus to judge mankind. A common symbol seen throughout Iran is an open hand. This is a complex symbol with a number of interpretations, but one is that the five fingers represent the "five bodies" central to Shi'ism—Muhammad, Fatimah, Ali, and the two sons of Fatimah and Ali, Husayn and Hassain.

It is Hassain, however, who is the true central figure in Iranian symbolic life. Hassain was martyred in a struggle for power between rival sects, later concretized as Shi'a and Sunni. This martyrdom is ritually observed throughout the year on every possible occasion. Pious individuals endow recitation of the story by professional panegyrists on a regular basis. The Islamic months of Muharram and Safar are months of ritual mourning for Hassain, with processions, self-flagellation, and ten-day dramatic depictions of the events of the martyrdom.

Just as Hassain is a central figure, everyone associated with him and his descendants who lived in Iran are equally revered—in particular Imam Reza, the eighth leader of Shi'a Muslims. Whereas all other Shi'a Imams are buried in modern Iraqi territory, Imam Reza is buried in the northeastern Iranian city, Mashhad. His astonishingly lavish shrine is one of the major pilgrimage destinations for Shi'a Muslims.

Although the vast majority of Iranians are Twelver Shi'a Muslims, important religious minorities have always played an important role in Iranian life. Zoroastrians date back to the Achaemenid Empire more than two thousand years ago. Iranian Jews claim to be the oldest continuous Jewish community in the world, dating back to the removal to Babylon. Armenians, an ancient Christian people, were imported by Iranian rulers for their artisanry, and Assyrian Christians, who follow a non-Trinitarian doctrine, have been continually resident in Iran since the third century. Sunni Muslims are represented by Arab and Baluchi populations in the south and Turkish populations in the north and west. One religious group is homegrown. The Baha'i movement, a semi-mystical nineteenth-century departure from Shi'ia Islam, won converts not only from Islam, but also from Judaism, Zoroastrianism, and Christianity. Considered a heresy by many Shi'a Muslims, Baha'i has spread from Iran to virtually every nation on earth.

Religious Practitioners. There is no formal certification for Islamic clergy. Technically, all sincere Muslims can establish themselves as religious practitioners. Women cannot preach to men, but female clerics ministering to women are not uncommon. In the normal course of training a young man attends a religious school. He takes classes from revered scholars who give him a certificate when he has completed a course of study to their satisfaction. After some time he may receive a call to take up residence in a community needing a cleric.

In time, he may acquire a reputation as a mujtahed or "jurisprudent," capable of interpreting Islamic law. Since there is no fixed theological doctrine in Shi'ism beyond the Koran and the Hadith (traditions of the prophet Muhammad), believers are free to follow the religious leader of their choice, and his interpretation of Islamic law. In time, as a mujtahed gains respect and followers, he may rise to become an ayatollah (literally, Reflection of God"). Ayatollah Ruhollah Khomeini, who in the 1970s had the largest number of followers of all religious leaders, led the Iranian Revolution.

Mysticism plays an important role in Iranian religion. Religious orders of Sufi mystics have been active in Iran for many centuries. Sufis focus on an inward meditative path for the pursuit of religious truth that may include group chanting and dance. Because they believe religion to be a personal spiritual journey, they eschew the outward trappings of social and economic life, and are highly revered.

Rituals and Holy Places. Shrines of Islamic saints are extremely important in Iranian religious practice. Most of these burial places, which receive regular visits from believers, are purported graves of the descendants of the prophet Muhammad through the Shi'a Imams. A pilgrimage to a local shrine is a common religious and social occasion. Longer pilgrimages to Karbala, Mashhad, or Mecca are greatly respected.

Most holidays in Iran are religious holidays revolving around the birth or death of the various Shi'a Imams. There are thirty of these days, all calculated according to the lunar calendar, which is always at variance with the Iranian solar calendar. This can complicate people's lives. It is necessary to have a Muslim cleric in the community just to calculate the dates. Most of these holidays involve mourning, at which time the story of Hassain's martyrdom at Karbala is recited. The exception is the birthday of the Twelfth Imam, which is a happy celebration.

Medicine and Health Care

Health care in Iran is generally very good. Life expectancy is relatively high (70 years) and the nation does not have any severe endemic infectious diseases. The principal cause of death is heart and circulatory disease. Many physicians emigrated at the time of the Islamic Revolution, but a sufficient number, supplemented by doctors from South Asia, continue to serve the population.

Health care programs in recent years have been highly successful. Malaria has been virtually eliminated, cholera and other waterborne diseases are generally under control, and family planing programs have resulted in dramatic decreases in fertility rates. The infant mortality rate remains somewhat elevated (twenty-nine per thousand) but it has declined significantly over the past twenty years. AIDS figures are suppressed.

Opium addiction has been a continual medical concern in Iran. The Pahlavi regime attempted to phase out its use by licensing the sale of state-produced raw opium only to certified addicts born after a specified date. It was thought that all the addicts would eventually die, and the problem would be solved. Of course, the availability of opium on the free market simply guaranteed that it would be resold to younger people at a profit, and the problem continued. The use of opium persists as a casual drug for all classes of society, with a small proportion of continued addicts.

A folk belief prevalent in Iran revolves around dietary practice. This philosophy tries to maintain balance between the four humors of the body— blood, phlegm, yellow bile, and black bile—through judicious combinations of foods. Although more sophisticated Iranians use the full range of four humors in their dietary calculations, most adhere to a two-category system: hot and cold. For example, visitors quickly learn that their friends will not allow the simultaneous consumption of watermelon and yogurt (both cold foods), for fear that this combination will cause immediate death.

Secular Celebrations

Most holidays in Iran are religious in nature. The few secular holidays relate to pre-Islamic practices, or modern political events.

The Iranian New Year's Celebration (Now Ruz ) is the nation's principal secular holiday. The Now Ruz celebration is replete with pre-Islamic symbolism, beginning with the practice of jumping over bonfires on the Wednesday before the equinox. An array of symbols emphasizing agricultural renewal is displayed throughout the long period of celebration, which lasts for thirteen days. Accompanying the festivities is the celebratory presence of a black-faced clown, Hajji Firouz. In some parts of the country a "king" of the New Year is selected and catered to during the holiday. On the thirteenth day he is ritually sacrificed.

In some parts of Iran the winter solstice is celebrated in a special manner. Watermelons are saved from the summer and hung in a protected place. On the longest night of the year, family and friends stay up all night, tell stories, and eat the watermelons.

The nation also celebrates Islamic Republic Day on 1 April to mark the 1979 Revolution.

The Arts and Humanities

Support for the Arts. The role of the arts in Iran is highly complex. On the one hand, Iranians have one of the richest and most elaborate artistic traditions in the world. On the other hand, Islamic leaders disapprove of many forms of artistic expression. Under the Pahlavi regime, especially under the patronage of the empress, Farah Diba, the arts were heavily supported and promoted. Under the Islamic republic this support has continued, but with many fits, starts, and caveats. Moral censorship has invaded virtually every form of artistic expression, but the inventive Iranians somehow manage to produce marvelous art despite these restrictions.

Two Islamic prohibitions affect arts in the most direct way: a prohibition against music, and one against the depiction of humans and animals in art. The prophet Muhammad disapproved of music because it acted to transport listeners to another mental sphere, distracting them from attention to the world created by God. The depiction of humans and animals is disapproved on two grounds: first, because it could be construed as idolatry; and second, because it could be seen as an attempt to create an alternate universe to that created by God. Additionally, the early Muslims considered poetry to be suspect, since it was thought to be inspired by jinn. For these reasons the Koran, certainly one of the most poetic works ever created, is explicitly not poetry. Chanting of the Koran is likewise not music. Over the centuries Iranians have taken these prohibitions somewhat lightly.

Literature. Iranian poets have penned some of the most wonderful, moving poetry in the history of humankind. The great poets Firdawsī, Hāfez, Sa'adī, and Jalāl ad-D n ar-R m and a host of others are an intimate part of the life of every Iranian. Modern poets writing in non-metric styles are equally revered, and the nation has developed a distinguished coterie of novelists, essayists, and exponents of belles lettres, both male and female.

Graphic Arts. Persian miniature paintings illustrating Iranian epics and classic stories are among the world's great art treasures. These miniatures depicted both humans and animals. Another tradition, more religiously approved, is the artistic development of calligraphy. This is a highly developed Iranian art, as it is throughout the Middle East. Iran has its own styles of Arabic calligraphy, however, and has developed many modern artists who fashion common words into figurative art of great beauty. Iran's modern painters often use classic themes from miniatures combined with calligraphy for a uniquely Persian effect. Geometric design is also approved, and is seen in architectural detail and carpet design.

No discussion of Persian art would be complete without mention of carpet making. Carpets are Iran's most important export item after oil, and their creation is an art of the highest order. Carpets are hand-knotted. The finest take years to complete and have hundreds of knots per square inch. The designs are drawn from a traditional stock of motifs, but are continually elaborated upon by weavers. Each region of Iran has its own traditional designs. Carpets are not only beautiful works of art, they are investments. Older carpets are worth more than new carpets. Every Iranian family will try to own one, with the secure knowledge that if they take care in their purchase it will always increase in value.

Also of significance are the centuries-old traditions of silverwork, wood-block printing, enamel ware, inlay work, and filigree jewelry manufacture. These arts were revived during the Pahlavi era in government-sponsored workshops and training programs. This support has continued after the Revolution, and owning excellent examples of these artistic products has become a hallmark of good taste in Iranian homes.

Performance Arts. Persian classical music is one of the most elaborate and inspiring artistic forms ever created. The musical system consists of twelve modal units called dastgah. These are divided into small melodic units called gusheh, most of which are associated with classic Persian poetic texts. A full performance of classical music consists of alternating arhythmic and rhythmic sections from a single dastgah. The instrumentalist and the vocal artist improvise within the modal structure, creating a unique performance. Traditional instruments include the tar,: a lute like instrument with a body shaped something like a figure eight; the setar,a smaller lute with three strings and a small, round body; the nei, a vertical flute; the kemanche, a small vertical fiddle with a long neck and a small body; the qanun, a larger, broader vertical fiddle; the santur, a hammer dulcimer; the dombak, a double-headed drum; and the daf, a large tambourine. Popular music forms are largely based on the more melodic structures of classical music, and are highly disapproved by the religious authorities. Many popular Iranian musicians now live abroad, where they record and export their music back to Iran. Women are not allowed to perform music in public under the current government.

Iran has two unique traditional dramatic forms. The first, ta'zieh, is an elaborate pageant depicting the death of Imam Hassain. In its full form, it lasts ten days during the month of Muharram, and involves hundreds of performers and animals. The other dramatic form is less elevated, but equally unique. It is a comic improvisatory form known commonly as ru-howzi theater, because it was typically performed on a platform placed over the pool (howz ) in a courtyard. Ru-howzi theater is performed by itinerant troupes at weddings and other celebrations, and is greatly appreciated. It has undergone a revival since the Revolution. Modern Western drama entered Iran at the end of the nineteenth century and attracted a number of fine playwrights whose works are regularly performed in live theater and on television.

Iranian film has captured the interest of the entire world in recent years, winning major international prizes. The Iranian film industry is decades old, but in the 1970s it began to develop as a serious art form under the sponsorship of National Iranian Radio and Television. Young film makers remained in Iran after the Revolution to create masterpieces of film art, despite censorship restrictions. This is somewhat confounding for the religious officials of the Islamic republic, since the most conservative officials condemned film attendance as immoral before the Revolution. Now they realize that Iranian film makers give Iran a progressive, positive image, and they grudgingly lend their support to the industry.

The State of the Physical and Social Sciences

Iran has had a long and proud national tradition in mathematics and the sciences. Iranians view this as an emanation of their cultural heritage. During the period from the ninth to the twelfth centuries the greatest scientists in Baghdad, often thought of as Arabs, were in fact Iranian scholars. Avicenna (Ibn Sīnā) is perhaps the most famous of these. The high regard for medicine and engineering has produced the strongest education and research programs in the country. More than half of all university students are enrolled in these fields.

There are forty-four universities (fifteen in Tehran) currently active in Iran along with a number of other institutes of higher learning and technical training. Approximately 450,000 students are enrolled, men outnumbering women two to one. The University of Tehran, Tehran Polytechnic University, the University of Isfahan, the University of Shīrāz, and the University of Tabrīz are premier educational institutions operating at a high international standard.

One of the more interesting developments following the Revolution was the establishment of the Islamic Open University. This was largely due to student discontent with the restrictive admission policies of the existing universities. Set up throughout the country, it is truly a university without walls, enrolling nearly 400,000 students. Although admission examinations are required, it is not necessary for applicants to submit standard high school diplomas for admission.

A third innovation in higher education has been the establishment of a correspondence institution, the Remote University. This is open to everyone, but in practicality it serves primarily government officials, teachers, and civil servants who wish to further their education.

The nation has enough applied scientists to carry out the functions of infrastructure maintenance and health care. Nevertheless, research institutes have suffered severe declines since the Revolution. Many of the country's best scientists and researchers emigrated to Europe and the United States. A few have returned, but the combination of the massive brain drain and the relatively young population of the nation indicate that it will be some time before much rebuilding can take place.

The government has realized that this is a problem and has increased appropriations to research institutes in recent years. The National Research Council formulates national research policy. The Industrial and Scientific Research Organization of the Culture and Higher Education Ministry carries out research for the government. Other institutes, such as the Institute for Theoretical Physics and Mathematics and the Institute for Oceanographic Research, are given little support.

Social science research is somewhat underdeveloped in Iran. Where it exists it has been developed on French models. The University of Tehran has strong faculties in sociology, psychology, and linguistics, and an active Institute for Social Studies and Research. The University of Shīrāz also has instruction and research in anthropology and sociology.

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—William O. Beeman

Iran

Compiled from the June 2007 Background Note and supplemented with additional information from the State Department and the editors of this volume. See the introduction to this set for explanatory notes.

Official Name:

Islamic Republic of Iran

PROFILE

Geography

Area: 1.6 million sq. km. (636,295 sq. mi., slightly larger than Alaska). Arable land: 9.78% of the country.

Cities: Capital—Tehran. Other cities—Isfahan, Tabriz, Mashhad, Shiraz, Yazd, Qom.

Terrain: Desert and mountains.

Climate: Semiarid; subtropical along the Caspian coast.

People

Nationality: Noun and adjective—Iranian(s).

Population: (2007) 65.4 million. Population growth rate: (2007 est.) 0.663%.

Ethnic groups: Persians 51%, Azeri 24%, Gilaki and Mazandarani 8%, Kurd 7%, Arab 3%, Lur 2%, Baloch 2%, Turkmen 2%, other 1%.

Religions: Shi’a Muslim 89%; Sunni Muslim 9%; Zoroastrian, Jewish, Christian, and Baha'i 2%.

Languages: Persian and Persian dialects 58%, Turkic languages (besides Turkish) 26%, Kurdish 9%, Luri 2%, Balochi 1%, Arabic 1%, Turkish 1%, other 2%.

Education: Literacy (total population age 15 and over who can read and write, 2003)—79% (male: 86%, female: 73%).

Health: (2007 est.) Infant mortality rate—38.2 deaths/1,000 live births. Life expectancy at birth (2007)—total population: 70.56 yrs.

Government

Type: Islamic republic.

Constitution: Ratified in December 1979, revised 1989.

Government branches: Executive—Supreme Leader (head of state), president (head of government), Council of Ministers, Assembly of Experts, Expediency Council, Council of Guardians. Legislative—290-member Majles (National Assembly, or Islamic Consultative Assembly). Judicial—Supreme Court.

Political parties: A number of reform-minded groups achieved considerable success during elections to the sixth Majles in early 2000. However, many reformist candidates, including sitting members of the Majles, were disqualified from participation in the February 2004 elections. As a result, a new conservative group, the Builders of Islamic Iran, won a majority of the seats and took a leading position in the seventh Majles.

Political subdivisions: 30 provinces.

Suffrage: Universal suffrage. The government is debating raising the voting age from 15 to 18.

Economy

GDP: (purchasing power parity, 2006 est.) $599.2 billion.

GDP: (official exchange rate, 2006 est.) $193.5 billion.

GDP real growth rate: (2007 est.) 4.6%.

GDP composition by sector: (2006) Agriculture 11.2%, industry 41.7%, services 47.1%.

Per capita income: (2006 est.) $8,700.

Work force: 24.36 million. Work force—by occupation (2001 est.) Agriculture 30%, industry 25%, services 45%.

Unemployment rate: (2007 est.) 20%.

Natural resources: Petroleum, natural gas, coal, chromium, copper, iron ore, lead manganese, zinc, sulfur.

Agriculture: Principal products—wheat, rice, other grains, sugar beets, fruits, nuts, cotton, dairy products, wool, caviar. Note: Iran is not self-sufficient in terms of food.

Industry: Types—petroleum, petrochemicals, textiles, cement and building materials, food processing (particularly sugar refining and vegetable oil production), metal fabricating (particularly steel and copper), armaments.

Trade: (2007 est.) Exports—$56.9 billion: petroleum 80%, chemical and petrochemical products, carpets, fruits, nuts. Major export partners (2006) Japan (17.3%), China (11.4%), Italy (6.2%), South Korea (5.2%), South Africa (5.5%), Turkey (5.7%), Netherlands (4.6%), France (4.1%), Taiwan (4.1%). Imports—$48.1 billion: industrial raw materials and intermediate goods, capital goods, foodstuffs and other consumer goods, technical services, military supplies. Major import partners: Germany (14.2%), U.A.E. (6.7%), China (8.3%), Italy (7.5%), France (6.2%), South Korea (5.4%), Russia (4.9%).

PEOPLE

Iran is a pluralistic society. Persians are the largest predominant ethnic and cultural group in this country, though many are actually of mixed ancestry. The population of the country has important Turkic elements (e.g., Azeris) and Arabs predominate in the southwest. In addition, Iranian citizens include Kurds, Balochi, Bakhtyari, Lurs, and other smaller minorities, such as Armenians, Assyrians, Jews, and Brahuis (or Brohi).

The 1979 Islamic revolution and the 1980-88 war with Iraq transformed Iran's class structure politically, socially, and economically. During this period, Shia clerics took a more dominant position in politics and nearly all aspects of Iranian life, both urban and rural. After the fall of the Pahlavi regime in 1979, much of the urban upper class of prominent merchants, industrialists, and professionals, favored by the former monarch, the shah, lost standing and influence to the senior clergy and their supporters. Bazaar merchants, who were allied with the clergy against the Pahlavi shahs, also have gained political and economic power since the revolution.

The urban working class has enjoyed somewhat enhanced status and economic mobility, spurred in part by opportunities provided by revolutionary organizations and the government bureaucracy. Though the number of clergy holding senior positions in the parliament and elsewhere in government has declined since the 1979 revolution, Iran has nevertheless witnessed the rise of a post-revolutionary elite among lay people who are strongly committed to the preservation of the Islamic Republic.

Most Iranians are Muslims; 89% belong to the Shi’a branch of Islam, the official state religion, and about 9% belong to the Sunni branch, which predominates in neighboring Muslim countries. Non-Muslim minorities include Zoroastrians, Jews, Baha’is, and Christians.

HISTORY

The ancient nation of Iran, historically known to the West as Persia and once a major empire in its own right, has been overrun frequently and has had its territory altered throughout the centuries. Invaded by Arabs, Seljuk Turks, Mongols, and others—and often caught up in the affairs of larger powers—Iran has always reasserted its national identity and has developed as a distinct political and cultural entity.

Archeological findings indicate human activity in Iran during the middle Paleolithic era, about 100,000 years ago. The sixth millennium B.C. saw a fairly sophisticated agricultural society and proto-urban population centers. Many dynasties have ruled Iran, starting with the Achaemenid (559-330 B.C.) founded by Cyrus the Great. After the conquest of Persia by Alexander the Great and the Hellenistic period (300-250 B.C.) came the Parthian (250 B.C.-226 A.D.) and the Sassanian (226-651) dynasties.

The seventh century Arab-Muslim conquest of Iran was followed with invasions by the Seljuk Turks and the Mongols. Iran underwent something of a revival under the Safavid dynasty (1502-1736), the most prominent figure of which was Shah Abbas, who expelled the Uzbeks and Ottomans from Persia. The conqueror Nadir Shah and his successors were followed by the Zand dynasty, founded by Karim Khan, and later the Qajar (1795-1925) and the Pahlavi dynasties (1925-1979). Modern Iranian history began with a nationalist uprising against the Shah in 1905 and the establishment of a limited constitutional monarchy in 1906. The discovery of oil in 1908 would later become a key factor in Iranian history and development.

In 1921, Reza Khan, an Iranian officer of the Persian Cossack Brigade, seized control of the government. In 1925, having ousted the Qajar dynasty, he made himself Shah and established the Pahlavi dynasty, ruling as Reza Shah for almost 16 years.

Under Reza Shah's reign, Iran began to modernize and to secularize, and the central government reasserted its authority over the tribes and provinces. During World War Two the Allies feared the monarch close relations with Nazi Germany. In September 1941, following the occupation of western Iran by the Soviet Union and the United Kingdom, Reza Shah was forced to abdicate. His son, Mohammad Reza Pahlavi, became Shah and would rule until 1979.

During World War Two, Iran had been a vital link in the Allied supply line for lend-lease supplies to the Soviet Union. After the war, Soviet troops stationed in northwestern Iran not only refused to withdraw but backed revolts that established short-lived, pro-Soviet separatist regimes in the northern regions of Azerbaijan and Kurdistan. These ended in 1946. The Azerbaijani revolt crumbled after U.S. and United Nations (UN) pressure forced a Soviet withdrawal. Iranian forces also suppressed the Kurdish uprising.

In 1951, the government of nationalist Prime Minister Mohammed Mos-sadeq (sometimes spelled Mossadegh) nationalized the British-owned Anglo-Iranian Oil Company (AIOC). The Shah fled to Rome from Iran before the U.S.-backed coup against Mossadeq in August 1953, during which pro-Shah army forces arrested the Prime Minister. The Shah returned soon thereafter. A few years later, AIOC was renamed British Petroleum, better known today as BP.

In 1961, Iran initiated a series of economic, social, and administrative reforms that became known as the Shah's White Revolution. The core of this program was land reform. Modernization and economic growth proceeded at an unprecedented rate, fueled by Iran's vast petroleum reserves, the third-largest in the world. However, his autocratic method of rule and pro-western policies alienated large sectors of the population, including the Shia clergy.

In 1978, domestic turmoil swept the country as a result of religious and political opposition to the Shah's rule, including abuses committed by SAVAK, the hated internal security and intelligence service. In January 1979, the Shah left Iran; he died abroad several years after.

On February 1, 1979, exiled religious leader Ayatollah Ruhollah Khomeini returned from France, to assume control of the revolution and established himself as Supreme Leader of a new, theocratic republic guided by Islamic principles. Following Khomeini's death on June 3, 1989, the Assembly of Experts chose the outgoing president of the republic, Ali Khamenei, to be his successor as Supreme Leader in what proved to be a smooth transition.

In August 1989, Akbar Hashemi-Rafsanjani, the speaker of the Majles, was elected President by an over-whelming majority. He was re-elected June 1993, with a more modest majority. Some Western observers attributed the reduced voter turnout to disenchantment with the deteriorating economy. An overwhelming majority of Iranians elected Mohammad Khatami-Ardakani as President in August 1997, hoping he would usher in a new era of freedom and reform. Khatami had modest successes in broadening the participation of Iranians in government and politics through initiating popular elections for local government councils and encouraging the development of civil society. Many liberal-minded Iranians were disappointed that Khatami did not support student protesters in 1999, but he was nevertheless re-elected in June 2001.

In February 2004 flawed elections were held for the Seventh Majles in which many reformists were prohibited from contesting their seats, meaning that a much more conservative group of parliamentarians easily retook control of the Majles in May 2004. The next Majles elections are currently slated to take place on March 14, 2008.

None of the seven candidates in the presidential vote on June 17, 2005 received a majority, resulting in a two-candidate runoff between Tehran mayor Mahmud Ahmadi-Nejad and former President Akbar Hashemi Rafsanjani on June 24. Ahmadi-Nejad, winning in the second round with almost 62% of the vote according to Iranian Government figures, took office in August 2005. The next presidential elections are scheduled for 2009.

GOVERNMENT

The December 1979 Iranian constitution defines the political, economic, and social order of the Islamic republic. The document establishes Shi'a Islam of the Twelver (Jaafari) sect as Iran's official religion. Sunni Islam, Zoroastrianism, Judaism and Christianity are the only other recognized, legal minority religions. The country is governed by secular and religious leaders through governing bodies, whose duties often overlap.

The Supreme Leader holds power for life unless removed by the Assembly of Experts. He has final say on all domestic, foreign, and security policies for Iran, though he establishes and supervises those policies in consultation with the Expediency Council. The Leader is the final arbiter on all differences or disputes among the various branches of government. He appoints officials to key positions including the head of judiciary and the 12 members of the Guardian Council (six directly, six indirectly). He has power to remove the president and is commander-in-chief of the armed forces.

The constitution stipulates that the Assembly of Experts, which currently consists of the 86 popularly-elected clerics elected to 8-year terms, chooses the Supreme Leader based on jurisprudent qualifications and commitment to the principles of the revolution. The Assembly of Experts reviews his performance periodically and has the power to depose and replace him. Pragmatic conservative candidates generally polled better than their hardline conservative opponents during the December 15, 2006 elections to the Assembly of Experts. (Turnout for this vote, which coincided with municipal council elections, was quite high, topping 60%.) Citizens will not vote for representatives to the Assembly again until 2014.

The Council of Guardians consists of 12 persons. The Supreme Leader appoints the six religious members of the Council of Guardians while the Iranian parliament, the Majles, selects the six lay members from candidates recommended by the judiciary, which is in turn selected by the Supreme Leader. The non-clerics play a role only in determining whether legislation before the Majles conforms to Iran's constitution. The religious members, on the other hand, take part in all deliberations, considering all bills for conformity to Islamic principles. The Council of Guardians can veto any law. This body also certifies the competence of candidates for the presidency, the Assembly of Experts, and the Majles.

The president of the Islamic Republic of Iran is elected by universal suffrage to a 4-year term. The president supervises the affairs of the executive branch, appointing and supervising the Council of Ministers (members of the cabinet), coordinating government decisions, and selecting government policies to be placed before the National Assembly. The Majles, or National Assembly, consists of 290 members elected to 4-year terms. The members of the legislature are elected by direct and secret ballot from among the candidates approved by the Council of Guardians.

In 1988, Ayatollah Khomeini created the Council for Expediency, which resolves legislative issues on which the Majles and the Council of Guardians fail to reach an agreement. Since 1989, it has been used to advise the national religious leader on matters of national policy as well. It is composed of the president, the speaker of the Majles, the judiciary chief, the clerical members of the Council of Guardians, and other members appointed by the Supreme Leader for 3-year terms. Cabinet members and Majles committee chairs also serve as temporary members when issues under their jurisdictions are considered. In 2005, it was announced that the Expediency Council, which now has over 40 members, would have responsibility for general supervision of the system, though that has not resulted in any noticeable change in this institution's day-to-day authority or operations.

Judicial authority is constitutionally vested in the Supreme Court and the four-member High Council of the Judiciary; these are two separate groups with overlapping responsibilities and have one head. Together, they are responsible for supervising the enforcement of all laws and for establishing judicial and legal policies.

Iran has two military forces. The national military is charged with defending Iran's borders, while the Islamic Revolutionary Guard Corps (IRGC) is charged mainly with maintaining internal security.

Iran has 30 provinces managed by an appointed governor general. The provinces are further divided into counties, districts, and villages. Sixty percent of eligible voters took part in the first ever municipal and local council elections in 1999, though a lower percentage went to the polls in the second round in 2003. Turnout during the December 15, 2006 elections, during which citizens also elected Assembly of Expert representatives, was over 60%. The local councils select mayors.

Principal Government Officials

Last Updated: 2/1/2008

Supreme Leader: Ali Hoseini-KHAMENEI, Ayatollah

Pres.: Mahmud AHMADI-NEJAD

Speaker of the Islamic Consultative Assembly (Majles): Qolam Ali HADAD-ADEL

Sec. of the Cabinet: Masud ZARIBAFAN

First Vice Pres.: Parviz DAVUDI

Vice Pres. for Atomic Energy: Qolam Reza AQAZADEH-Khoi

Vice Pres. for Cultural Heritage & Tourism: Esfandiar Rahim MASHAIE

Vice Pres. for Environmental Protection: Fatemeh JAVADI

Vice Pres. for Executive Affairs: Ali SAIDLU

Vice Pres. for Legal & Parliamentary Affairs: Ahmad MUSAVI

Vice Pres. for Management & Planning: Mansur BORQEI

Vice Pres. for Martyrs & War Veterans Affairs: Hosein DEHQAN

Vice Pres. for National Youth Organizations: Ali AKBARI, Hojjat ol-Eslam

Vice Pres. for Physical Education: Mohammad ALI-ABADI

Min. of Agricultural Jihad: Mohammad Reza ESKANDARI

Min. of Commerce: Masud MIR-KAZEMI

Min. of Communication & Information Technology: Mohammad SOLEIMANI

Min. of Cooperatives: Mohammad ABBASI

Min. of Defense & Armed Forces Logistics: Mostafa Mohammad NAJAR, Brig. Gen. (Ret.)

Min. of Economic Affairs & Finance: Davud DANESH-JAFARI

Min. of Education: Mahmud FARSHIDI

Min. of Energy: Parviz FATAH

Min. of Foreign Affairs: Manuchehr MOTAKI

Min. of Health: Kamran BAQERI-LANKARANI

Min. of Housing & Development: Mohammad SAIDI-KIA

Min. of Industries & Mining: Ali Akbar MEHRABIAN

Min. of Intelligence & Security: Qolam Hosein MOHSENI-EJEI

Min. of Interior: Mostafa PUR-MOHAMMADI

Min. of Islamic Culture & Guidance: Mohammad Hosein SAFAR-HARANDI

Min. of Justice: Qolam Hosein ELHAM

Min. of Labor & Social Affairs: Mohammad JAHROMI

Min. of Petroleum: Qolam Hosein NOZARI

Min. of Roads & Transportation: Mohammad RAHMATI

Min. of Science, Research, & Technology: Mohammad Mehdi ZAHEDI

Min. of Welfare & Social Security: Abdol Reza MESRI

Govt. Spokesman: Qolam Hosein ELHAM

Governor, Central Bank of Iran: Tahmaseb MAZAHERI-Khorasani

Head of Interest Section in the US:Mostafa RAHMANI

Permanent Representative to the UN, New York: Mohammad KHAZAI-Torshizi

POLITICAL CONDITIONS

Iran's post-revolution difficulties have included an 8-year war with Iraq, internal political struggles and unrest, and economic disorder. The early days of the regime were characterized by severe human rights violations and political turmoil, including the seizure of the U.S. Embassy compound and its occupants on 4 November 1979, by Iranian student militants. Iranian authorities released the 52 hostages only after 444 days of captivity.

By mid-1982, the clergy had won a succession of post-Revolution power struggles that eliminated first the center of the political spectrum and then the leftists, including the communist Tudeh party and the cult-like Mujahedin-e Khalq Organization (MEK or MKO). Assassinations, throwing acid in the faces of women who refused to wear the veil, and other acts of violence punctuated this period. There has been some moderation of excesses since the early days of the revolution, and the country experienced a partial “thaw” in terms of political and social freedoms during the tenure of former president Khatami, but serious problems remained. The administration of President Ahmadi-Nejad has witnessed a crackdown on Iranian civil society, continued human rights violations, and worsening constraints on press freedom and civil liberties.

The Islamic Republican Party (IRP) was Iran's sole political party until its dissolution in 1987. Iran now has a variety of groups engaged in political activity; some are oriented along ideological lines or based on an identity group, others are more akin to professional political parties seeking members and recommending candidates for office. Some have been active participants in the Revolution's political life while others reject the state. Conservatives consistently thwarted the efforts of reformists during the Khatami era and have consolidated their control on power since the flawed elections for the seventh Majles in 2004 and president Ahmadi-Nejad's victory in 2005.

The Iranian Government has faced armed opposition from a number of groups, including the MEK (which the U.S. Government added to its list of Foreign Terrorist Organizations in 1999), the People's Fedayeen, and the Kurdish Democratic Party of Iran (KDPI).

ECONOMY

Pre-revolutionary Iran's economic development was rapid. Traditionally an agricultural society, by the 1970s Iran had achieved significant industrialization and economic modernization. However, the pace of growth had slowed dramatically by 1978, just before the Islamic revolution. Since the fall of the shah, economic recovery has proven elusive thanks to a combination of factors, including fluctuations in the global energy market. Economic activity was severely disrupted additionally by years of upheaval and uncertainty surrounding the revolution and the introduction of statist economic policies. These conditions were worsened by the war with Iraq and the decline in world oil prices beginning in late 1985. After the war with Iraq ended, the situation began to improve: Iran's GDP grew for two years running, partly from an oil windfall in 1990, and there was a substantial increase in imports. However, Iran had suffered a brain drain throughout the previous decade and wartime policies had resulted in a demographic explosion.

A decrease in oil revenues in 1991 and growing external debt dampened optimism for recovery. In March 1989, the government instituted a new 5-year plan for economic development, which loosened state control and allowed Iran to seek greater latitude in accessing foreign capital. Mismanagement and inefficient bureaucracy, as well as political and ideological infighting, hampered the formulation and execution of a consolidated economic policy, and the Iran fell short of the plan's goals while economic inequality was aggravated. Today, Iran's economy is a mixture of central planning, state ownership of oil and other large enterprises, village agriculture, and small-scale private trading and service ventures. Former President Khatami followed the market reform plans of his predecessor, President Rafsanjani, and indicated that he would pursue diversification of Iran's oil-reliant economy, although he made little progress toward that goal. High inflation and expansive public transfer programs, as well as powerful economic-political vested interests created obstacles for rapid reform.

During the 2005 election campaign, President Ahmadi-Nejad promised to redistribute oil revenues to the impoverished, fund large infrastructure projects, and privatize Iranian state enterprises. He has been criticized within Iran for not carrying through on many of his promises. While establishment of the Imam Reza fund for cheap loans to youth has been popular, a law increasing the minimum was revoked because of the huge strain on employers. The “Shares of Justice” program—distributing shares of state-owned enterprises to the poor—faces a number of potential problems.

Unemployment was estimated to be 20% for 2007, according to the International Monetary Fund. Unemployment, a major problem even before the revolution, has many causes, including population growth, high minimum wage level and other restrictive labor policies. Farmers and peasants enjoyed a psychological boost from the attention given them by the Islamic regime but hardly appear to be better off in economic terms. The government has made progress on rural development, including electrification and road building, but Iran still faces inefficiencies related to agricultural land usage which are politically difficult to reconcile. Agriculture also has suffered from shortages of capital, raw materials, and equipment, problems dating back to the 1980-1988 war with Iraq.

Although Islam guarantees the right to private ownership, banks and some industries—including the petroleum, transportation, utilities, and mining sectors—were nationalized after the revolution under Marxist-influenced economic policies. Starting under President Rafsanjani, Iran has pursued some privatization through its nascent equities markets. However, the industrial sector remains plagued by low labor productivity and shortages of raw materials and spare parts, and is uncompetitive against foreign imports.

Increases in the price of oil starting in 2003 have increased state revenue enormously and permitted a much larger degree of spending on social programs than previously anticipated. However, this has not eased economic hardships such as high unemployment and inflation. The proportion of the economy devoted to the development of weapons of mass destruction and military spending overall remains a contentious issue with leading Western nations.

Earnings from Iranian oil exports, projected at $57-$87 billion for 2007-2008, are placed into the Oil Stabilization Fund (OSF), originally designed as a Treasury safety net if oil prices dropped below $20/barrel. In practice, the government has drawn upon the OSF to cover overex-penditures. Iran relies on oil for 80% of its export revenue, and 40% of total revenues. (Note: Iran's refining capacity is limited, and Tehran is a net gasoline importer, spending $2.6 billion for foreign gas in 2005.)

FOREIGN RELATIONS

Khomeini's revolutionary regime initiated sharp changes from the foreign policy pursued by the Shah, particularly in reversing the country's orientation toward the West. In the Middle East, Iran's only significant ally has been Syria, but Iran has made strides in improving relations with its Gulf neighbors, particularly Saudi Arabia.

Iran's foreign relations are based on sometimes competing objectives. Iran's pragmatic foreign policy goals include, not surprisingly, protecting itself from external threats and building trade ties. Iran has additionally been accused, however, of trying to export its fundamentalist revolution to other countries, sometimes supporting terrorist organizations, and its vehement anti-U.S. and anti-Israel stances are well-known. Senior Iranian officials directed Hezbollah to carry out the bombing of the Asociación Mutual Israelita Argentina (AMIA, the Argentine Israelite Mutual Association) building in Buenos Aires on July 18, 1994, killing 85 people and wounding scores of others. Out of the eight individuals indicted by the Government of Argentina in October 2006, the Interpol Executive Committee has recommended the issuance of Red Notices (international arrest warrants) against six: five former or current Iranian officials and one Lebanese Hezbollah leader.

In September 1980, during the U.S. hostage crisis, Iraq invaded Iran to take control of the waterway between the two countries, the Shatt al-Arab, although the conflict's underlying causes included each nation's overt desire for the overthrow of the other's government. Iran defended itself and demanded the withdrawal of Iraqi troops from Iranian territory and the return to the status quo ante for the Shatt al-Arab as established under the 1975 Algiers Agreement signed by Iraq and Iran. Khomeini's government turned down an Iraqi cease-fire proposal in 1982, making a new demand for Saddam Hussein's removal as well. After eight punishing years of war, in July 1988, Iran at last agreed to UN Security Council Resolution 598 and the cease-fire was implemented on August 20, 1988. Neither nation had made any real gains in the war.

Iran's relations with many of its Arab neighbors have been strained by Iranian attempts to spread its Islamic revolution, a strictly ideological goal. In 1981, Iran supported a plot to overthrow the Bahrain Government. In 1983, Iran expressed support for Shi'ites who bombed Western embassies in Kuwait, and in 1987, Iranian pilgrims rioted during the hajj (pilgrimage) in Mecca, Saudi Arabia. Nations with strong fundamentalist movements, such as Egypt and Algeria, also mistrust Iran. Iran backs Hezbollah (in Lebanon), Hamas, Palestinian Islamic Jihad, and the Popular Front for the Liberation of Palestine-General Command, all of which are violently opposed to the Arab-Israeli peace process. In contrast, while relations with west European nations have been uneven, they have been driven primarily by pragmatic goals of trade and security. Iran has accepted stronger commercial ties but largely declined to deliver on key European political concerns such as human rights and weapons of mass destruction (WMD) acquisition efforts, particularly in the nuclear field, where the International Atomic Energy Agency (IAEA) has been strongly critical of Iran.

An IAEA report in November 2003 provided evidence that Iran, a signatory to the Nuclear Non-Proliferation Treaty (NPT), had concealed secret nuclear activities for 18 years. Under international pressure, Iran signed the Additional Protocol to the Safeguards Agreement on December 18, 2003, agreeing to suspend all uranium-enrichment and reprocessing activities voluntarily, as well as cooperate fully with the International Atomic Energy Agency (IAEA) in resolving questions regarding Iran's nuclear program. In June 2004, the IAEA rebuked Iran for failing to fully cooperate with an inquiry into its nuclear activities, and in November 2004, Iran agreed to suspend most of its uranium enrichment under a deal with the EU. That promise did not last, however, and since then concerns over Iran's nuclear activities have increased.

On June 6, 2006, China, France, Germany, Russia, the United States, and United Kingdom offered Iran a substantial package of economic cooperation and assistance. Tehran, however, was first required to come into compliance with International Atomic Energy Agency (IAEA) guidelines on its nuclear program, suspending its uranium enrichment program. On July 31, the UN Security Council adopted resolution 1696 on the Iranian nuclear question, requiring Iran to suspend all activities related to enrichment and reprocessing, including research and development, as demanded by the IAEA, or else face possible sanctions. Tehran defied the UN Security Council (UNSC) deadline of August 31, leading to the passage of UNSC Resolution 1636 in December 2006 and, as Iran continued to balk, Resolution 1747 in March 2007.

Iran sparked an international controversy when its forces seized and held hostage 15 British sailors and marines, conducting routine anti-smuggling operations in Iraqi territorial waters under UN mandate, on March 23, 2007. Tehran released the U.K. service members on April 6.

Iran maintains regular diplomatic and commercial relations with Russia and the former Soviet republics. Both Iran and Russia believe they have important national interests at stake in developments in Central Asia and the Transcaucasus, particularly regarding energy resources from the Caspian Sea. Russian and other sales of military equipment and technology to Iran concern Iran's neighbors and the United States. Washington is also concerned about Russian assistance in building at nuclear facility at Bushehr. Iran spends about 3.3% of its GDP on its military. Iran's military consists of both a national military held over from the shah's government and the IRGC, each with its own ground, naval and air braches. The Iran-Iraq war took a heavy toll on these military forces. Iran is trying to modernize its military, including ballistic missile programs, and acquire weapons of mass destruction; it does not yet have, but continues to seek, nuclear capabilities.

U.S.-IRANIAN RELATIONS

On November 4, 1979, militant Iranian students occupied the American Embassy in Tehran with the support of Ayatollah Khomeini. Fifty-two Americans were held hostage for 444 days. On April 7, 1980, the United States broke diplomatic relations with Iran, and on April 24, 1981, the Swiss Government assumed representation of U.S. interests in Tehran. Iranian interests in the United States are represented by the Government of Pakistan. The Islamic Republic of Iran does not have its own embassy in Washington, though it does have a permanent mission to the United Nations in New York City.

In accordance with the Algiers declaration of January 20, 1981, the Iran-U.S. Claims Tribunal (located in The Hague, Netherlands) was established for the purpose of handling claims of U.S. nationals against Iran and of Iranian nationals against the United States. U.S. contact with Iran through The Hague covers only legal matters.

The U.S. Government, by Executive Orders issued by the President as well as by Congressional legislation, prohibits most trade with Iran. Some sanctions were imposed on Iran because Tehran is a state sponsor of terrorism, others because of the nuclear proliferation issues, and still more for human rights violations, including infringement of religious freedom. The commercial relations that do exist between the two countries consist mainly of Iranian purchases of food and medical products and U.S. imports of carpets and food. Some sanctions were temporarily waived in the wake of the devastating Bam earthquake of December 2003. U.S. officials and relief workers actively assisted in relief and reconstruction efforts.

There are serious obstacles to improved relations between the two countries. As a state sponsor of terrorism, Iran remains an impediment to international efforts to locate and prosecute terrorists. Recent attempts by Iran to form loose alliances with anti-U.S. governments in the Western Hemisphere, such as the Venezuelan Government, has further heightened concern about Iran's support for terrorism and nuclear ambitions. Operation Iraqi Freedom removed the Iranian Government's greatest security threat, but officially Iran remained neutral about U.S. policy, sometimes strongly condemning American policies and actions in Iraq. Iran has cultural ties to elements of the populations of both Iraq and Afghanistan. It has made some positive contributions to stability in both countries, but other actions have had the opposite effect. It remains to be seen whether Tehran will ultimately be a constructive force in the reconstruction of its two neighbors or not.

The U.S. Government defines its areas of objectionable Iranian behavior as the following:

• Iran's efforts to acquire nuclear weapons and other weapons of mass destruction;
• Its support for and involvement in international terrorism;
• Its support for violent opposition to the Middle East peace process, as well as its harmful activities particularly in Lebanon, as well as in Iraq, Afghanistan, and else-where in the region; and
• Its dismal human rights record and lack of respect for its own people.

The United States has held discussions with Iranian representatives on particular issues of concern over the years. U.S. and Iranian envoys cooperated during operations to overthrow the Taliban in 2001 and during the Bonn Conference in 2002 that established a broad-based government for the Afghan people under President Karzai. The Secretary of State, her Iranian counterpart, and others met at talks on Iraq in Sharm El Sheikh, Egypt, on May 3, 2007. The American and Iranian ambassadors to Iraq took part in face-to-face discussions in Baghdad, with Iraqi officials in attendance, on May 28, 2007. The United States believes, however, that normal relations are impossible until Iran's policies change.

Nevertheless, the U.S. State Department is supporting efforts to further the cause of democracy in Iran. In fiscal year (FY) 2006, the U.S. Congress allocated approximately $66 million to promote free media, personal freedom, and a better understanding of western values and culture. As part of these efforts, the Department supports efforts to develop civil society in Iran and exchange programs that bring Iranian students, athletes, professionals and others to the United States.

The Secretary of State has stated that Iranian agreement to abide by UNSC Resolutions 1696 and 1747, calling for Tehran to suspend uranium enrichment and comply with its international nuclear obligations, could lead to the direct negotiations between American and Iranian government officials, not only on Iran's nuclear case but on a wide range of issues.

In May 2007, the Iranian Government charged and in some cases imprisoned a handful of innocent Iranian-American scholars, civil society actors, and journalists, accused by the regime of jeopardizing the security of the state. The international community, academic institutions, non-governmental organizations (NGOs) and private citizens have joined the U.S. Government in calling for the release of the detained dual nationals, as well as Iranian cooperation in the case of missing retired FBI agent Robert Levinson, last reported on Kish Island, Iran, on March 8, 2007.

TRAVEL

Consular Information Sheet

June 5, 2007

Country Description: Iran is a constitutional Islamic republic with a theocratic system of government where ultimate political authority is vested in a learned religious scholar, the Supreme Leader. Shia Islam is the official religion of Iran, and Islamic law is the basis of the authority of the state. The Iranian Constitution guarantees freedom of worship to Jews, Christians and Zoroastrians, though they are sometimes the subject of discrimination and repression. The workweek in Iran is Saturday through Thursday; however, many government offices and private companies are closed on Thursdays. Friday is the day of rest when all establishments are closed. Offices in Iran are generally open to the public during the morning hours only.

Entry Requirements: Should you decide to travel to Iran despite the current Travel Warning, a passport and visa are required. To obtain a visa, contact the Iranian Interests Section of the Embassy of Pakistan located at 2209 Wisconsin Ave. NW, Washington, DC. 20007; tel 202-965-4990, 91, 92, 93, 94, 99, fax 202-965-1073, 202-965-4990 (Automated Fax-On-Demand after office hours). Their Internet website is http://www.daftar.org. U.S. citizens do not have to obtain a visa for travel from Dubai to Kish Island.

The Iranian press has reported that foreign tourists may obtain seven-day tourist visas at the airport in Tehran. However, U.S. citizens are strongly encouraged to obtain valid visas in advance to avoid delays and/or interrogation, as well as to reduce the prospect of denial of entry at the airport.

Note: possession of a valid Iranian visa will not guarantee entry into the country. Some American travelers with valid visas have been refused entry at the border without explanation.

U.S. passports are valid for travel to Iran. However, the Iranian government does not recognize dual nationality and will treat U.S.-Iranian dual nationals as Iranian citizens. Thus, U.S. citizens who were born in Iran, who became naturalized citizens of Iran (e.g. through marriage to an Iranian citizen), and children of such persons—even those without Iranian passports who do not consider themselves Iranian-are considered Iranian nationals by Iranian authorities. Therefore, despite the fact that these individuals hold U.S. citizenship, under Iranian law, they must enter and exit Iran on an Iranian passport, unless the Iranian government has recognized a formal renunciation or loss of Iranian citizenship. Dual nationals may be subject to harsher legal treatment than a visitor with only American citizenship.

In the past, U.S.-Iranian dual nationals have been denied permission to enter/depart Iran using their U.S. passport; they even had their U.S. passports confiscated upon arrival or departure. Depending on the circumstances, the individuals could sometimes get the U.S. passport back by renouncing their Iranian citizenship.

Recently, Iranian authorities have prevented a number of Iranian-American citizen academics, journalists, and others who traveled to Iran for personal reasons from leaving, and in some cases have detained and imprisoned them on various charges, including espionage and being a threat to the regime. Americans of Iranian origin should consider the risk of being targeted by authorities before planning travel to Iran. Iranian authorities may deny dual nationals’ access to the United States Interests Section in Tehran, because they are considered to be solely Iranian citizens. As a precaution, however, it is advisable for U.S.-Iranian dual nationals to obtain in their Iranian passports the necessary visas for the country to which they will transit upon their return to the U.S. so that, if their U.S. passports are confiscated in Iran, they may depart Iran with their Iranian passport. These individuals can then apply for a new U.S. passport in that third country.

Dual nationals whose U.S. passports are confiscated may also obtain a “Confirmation of Nationality” from the U.S. Interests Section of the Embassy of Switzerland, which is the U.S. protecting power. This statement, addressed to the relevant foreign embassies in Tehran, enables the travelers to apply for third-country visas in Tehran. Dual nationals who find themselves in this situation should note in advance that the Swiss Embassy will issue this statement only after the traveler's U.S. nationality is confirmed and after some processing delay. Dual nationals must enter and depart the United States on U.S. passports.

Visa extensions are time-consuming and must be filed at least one week in advance of the expiration date. As of March 21, 2006, a foreign national and anyone accompanying him/her will pay a fine of 300,000 rials or 30,000 tomans per day for each day of unauthorized stay in Iran.

All Iranian nationals, including U.S.-Iranian dual nationals, must have an exit permit stamped in their Iranian passports in order to depart Iran. The stamp is affixed to page 11 or 13 of the Iranian passport when it is issued and remains valid until the expiration date of the passport. All Iranian nationals residing abroad, including U.S.-Iranian dual nationals, are now required to pay an exit tax regardless of the duration of their stay in Iran, and are no longer exempted. Iranian nationals residing abroad are exempted from paying exit taxes if their stay in Iran does not exceed four months. All Iranian nationals living permanently in Iran are required to pay the exit tax upon departing Iran. More specific information on Iranian passport and exit visa requirements may be obtained from the Iranian Interests Section of the Embassy of Pakistan in Washington, D.C. Non-Iranian-national women who marry Iranian citizens gain Iranian nationality upon marriage. If the marriage takes place in Iran, the woman's U.S. passport will be confiscated by Iranian authorities. They likewise must have the consent of their husbands to leave Iran or, in his absence, must gain the permission of the local prosecutor. Because of Islamic law, compounded by the lack of diplomatic relations between the United States and Iran, the U.S. Interests Section in Tehran can provide only very limited assistance if an American woman married to an Iranian man has marital difficulties and/or encounters difficulty in leaving Iran.

After divorce or death of the husband, a woman has the choice to renounce her Iranian citizenship but any of the couple's children will automatically be Iranian citizens and their citizenship irrevocable. They will be required to enter and depart Iran on Iranian passports. For a divorce to be recognized it should be carried out in Iran or, if outside Iran, in accordance with Sharia law. Upon divorce, custody of the children normally goes to the mother until the child reaches age 7, at which point custody is automatically transferred to the father. However, if the courts determine that the father is unsuitable to raise the children, they may grant custody to the paternal grandfather or to the mother, if the mother has not renounced her Iranian citizenship and is normally resident in Iran. If the courts grant custody to the mother, she will need permission from the paternal grandfather or the courts to obtain exit visas for the minor children (under age 18) to leave the country. Iran is not a signatory to the Hague Convention on Child Abduction.

Safety and Security: U.S. citizens who travel to Iran despite the Travel Warning should exercise caution throughout the country, but especially in the southeastern region where Westerners have been victims of criminal gangs often involved in the smuggling of drugs and other contraband. For example, two Germans and one Irish were kidnapped and released in Sistan va Baluchestan in December 2003. American citizens should avoid travel to areas within 100 kilometers of the border with Afghanistan, within 10 kilometers of the border with Iraq, and generally anywhere east of the line from Bam and Bandar Abbas toward the Pakistan border.

Terrorist explosions have killed a number of people since 2005. Be aware that the Iranian government has blamed the US and/or UK governments for involvement in the February 2007 bombing that killed Iranian military forces in Zahedan in the southeast and the 2005/2006 bombings in Ahvaz/Khuzestan in the southwest. A number of British firms were damaged in attacks in August and November 2005.

U.S. citizens are advised to avoid demonstrations and large public gatherings. Increased tension between Iran and the West over the past several years is a cause of concern for American travelers.

Iranian security personnel may at times place foreign visitors under surveillance. Hotel rooms, telephones and fax machines may be monitored, and personal possessions in hotel rooms may be searched.

Photography near military and other government installations is strictly prohibited. You may be detained and face serious criminal charges, including espionage, which carries the death penalty.

For the latest security information, Americans traveling abroad should regularly monitor Department's Internet web site where the current Travel Warnings and Travel Alerts, including the Travel Warning for Iran, the Worldwide Caution Travel Alert and the Middle East and North Africa Travel Alert, can be found.

Up-to-date information on safety and security, including safety and security in Iran, can also be obtained by calling 1-888-407-4747 toll free in the U.S., or for callers outside the U.S. and Canada, a regular toll-line at 1-202-501-4444.

Crime: Major crime is generally not a problem for travelers in Iran, although foreigners occasionally have been victims of petty street crime. Young men in unmarked cars have robbed foreigners and young men on motor bikes have snatched bags. There have been reports of robberies by bogus policemen, usually in civilian clothing. Insist on seeing the officer's identity card and request the presence of a uniformed office/ marked patrol card. Travelers should not surrender any documents or cash.

Travelers should not carry large amounts of hard currency. In view of the possibility of theft, passports, disembarkation cards, other important documents and valuables should be kept in hotel safes or other secure locations. Pre-booked taxis are safer than those hailed from the street.

Americans should check with their hotel or tour guide for information on local scams.

In many countries around the world, counterfeit and pirated goods are widely available. Transactions involving such products may be illegal under local law. In addition, bringing them back to the United States may result in forfeitures and/ or fines. More information on this serious problem is available at http://www.cybercrime.gov/18usc2320.htm

Information for Victims of Crime: The loss or theft abroad of a U.S. passport should be reported immediately to the local police and the U.S. Interests Section at the Swiss Embassy in Tehran or the nearest U.S. Embassy or Consulate. Because of the lack of a U.S. Embassy in Iran, the processing time for a replacement passport takes longer at the U.S. Interests Section at the Swiss Embassy than elsewhere. If you are the victim of a crime while overseas, in addition to reporting to local police, please contact the U.S. Interests Section for assistance. The staff can, for example, assist you to find appropriate medical care, contact family members or friends and explain how funds could be transferred. Although the investigation and prosecution of the crime is solely the responsibility of local authorities, Swiss Embassy officers can help you to understand the local criminal justice process and to find an attorney if needed.

Medical Facilities and Health Information: Basic medical care and medicines are available in the principal cities, but may not be available in outlying areas. Medical facilities do not meet U.S. standards and sometimes lack medicines and supplies.

Information on vaccinations and other health precautions, such as safe food and water precautions and insect bite protection, may be obtained from the Centers for Disease Control and Prevention's hotline for international travelers at 1-877-FYI-TRIP (1-877-394-8747) or via the CDC's internet site at http://www.cdc.gov/travel. For information about outbreaks of infectious diseases abroad consult the World Health Organization's (WHO) website at http://www.who.int/en. Further health information for travelers is available at http://www.who.int/ith/en.

In 2006, there were reports of Crimean Congo Hemorrhagic Fever, mostly in the southeastern Sistan va Baluchistan province. Iranian authorities have confirmed outbreaks of avian influenza (bird flu) among wild swans in the Anzali Wetlands and in domestic poultry in the northern provinces of Azerbaijan and Gilan. There have been a number of fatalities from avian flu reported in eastern Turkey, 45 kilometers from the Iranian border.

Medical Insurance: The Department of State strongly urges Americans to consult with their medical insurance company prior to traveling abroad to confirm whether their policy applies overseas and whether it will cover emergency expenses such as a medical evacuation.

Traffic Safety and Road Conditions: While in a foreign country, U.S. citizens may encounter road conditions that differ significantly from those in the United States. The information below concerning Iran is provided for general reference only, and may not be totally accurate in a particular location or circumstance.

Travelers with International Driver's Permits may drive in Iran. Iran has a very high rate of traffic accidents, which are considered to be the second highest cause of mortality in the country. Drivers throughout Iran tend to ignore traffic lights, traffic signs and lane markers. Urban streets are not well lit. It is therefore particularly dangerous to drive at night. Sidewalks in urban areas only exist on main roads and are usually obstructed by parked cars. In the residential areas, few sidewalks exist. Drivers almost never yield to pedestrians at crosswalks.

U.S. citizens who are involved in an accident, no matter how minor, should not leave the scene. Wait until the police arrive to file a report.

Iranian authorities sometimes set up informal roadblocks, both in cities and on highways, often manned by young, inexperienced officers. They are often suspicious of foreigners. Ensure you carry a form of identification with you and avoid getting into disputes.

Pollution levels from cars are very high, particularly in Tehran, which can trigger respiratory problems.

Aviation Safety Oversight: As there is no direct commercial air service between the U.S. and Iran by local carriers, the U.S. Federal Aviation Administration (FAA) has not assessed the Government of Iran's Civil Aviation Authority for compliance with International Civil Aviation Organization (ICAO) aviation safety standards. For more information, travelers may visit the FAA's internet website at http://www.faa.gov.

Civil aviation in Iran continues to experience air incidents and accidents, including five crashes with fatalities between April 20, 2005, and November 27, 2006. Incidents included engine failure and planes veering off the runway.

Special Circumstances: The Iranian Government has seized the passports and blocked the departure of foreigners who work in Iran on tax/ commercial disputes.

In addition to being subject to all Iranian laws, U.S. citizens who also possess Iranian citizenship may also be subject to other laws that impose special obligations on citizens of Iran, such as military service or taxes.

Dual nationals sometimes have their U.S. passports confiscated and may be denied permission to leave Iran, or encounter other problems with Iranian authorities. Likewise, Iranian authorities may deny dual nationals’ access to the U.S. Interests Section in Tehran, because they are considered to be solely Iranian citizens. Refer to the above section entitled “Entry/Exit Requirements” for additional information concerning dual nationality.

U.S. citizens who are not dual U.S.- Iran nationals are encouraged to carry a copy of their U.S. passport (biodata page and page with Iranian visa) with them at all times, so that if questioned by local officials, proof of U.S. citizenship is readily available. Travelers should carry some other form of identification with, such as a drivers license or other photo identification at all times.

Credit cards and bank cards generally cannot be used in Iran. Traveler's checks can be difficult to exchange. Travelers should bring enough hard currency to cover their stay, but make sure they declare this currency upon entry. There is no Western Union or similar institutions and bank transfers are not possible. Travelers should only exchange money at banks or an authorized currency exchange facility, and keep exchange receipts.

Pre-paid overseas calling cards are available at most newsagents. The Internet is widely used in Iran. There are Internet cafes in most hotels. U.S. Citizens should not work illegally. Those who work illegally will be deported, fined and/or imprisoned. Illegal workers may also be prevented from entering the country again.

Islamic law is strictly enforced in Iran. Alcohol is forbidden. Importation of pork products is banned. Travelers should consult a good guide book on Iran to determine how to dress and behave properly and respectfully. Women should expect to wear a headscarf while in public. There may be additional dress requirements at certain religious sites, e.g., women might need to put on a chador (which covers the whole body except the face) at some shrines. During the holy month of Ramadan, you should in general observe the Muslim tradition of not eating, drinking or smoking in public from sunrise to sunset each day, though there are exemptions for foreign travelers who eat in hotel restaurants.

In general, it is best to ask before taking photographs of people. Hobbies like photography and those involving the use of binoculars (e.g., bird-watching) can be misunderstood and get you in trouble with security officials.

For specific information regarding Iranian customs regulations, contact the Iranian Interests Section of the Embassy of Pakistan in Washington, D.C.

U.S. Government economic sanctions still govern imports of Iranian-origin goods and services and exports to Iran. Except for carpets and food-stuffs, and information or informational materials and givets valued at $100 or less, the importation of Iranian-origin goods or services into the United States is prohibited. The exportation or re-exportation of goods, technology or services directly or indirectly from the United States or by a U.S. person to Iran also is prohibited, except in the following cases: articles donated to relieve human suffering (such as food, clothing and medicine), gifts valued at $100 or less, licensed exports of agricultural commodities, medicine and medical devices, and trade in informational materials. The Office of Foreign Assets Control (OFAC), Department of Treasury, provides guidance to the public on the interpretation of the current economic sanctions. For further information, consult OFAC's Compliance Programs Division, at 202-622-2490, visit the OFAC's website at http://www.treas.gov/offices/enforcement/ofac/, or obtain information via fax at 202-622-0077. For information concerning licensing of exports, contact OFAC's Licensing Division at:

Licensing Division
Office of Foreign Assets Control
U.S. Department of the Treasury
1500 Pennsylvania Avenue NW
Treasury Annex
Washington, DC 20220
Telephone (202) 622-2480; Fax (202)
622-1657

Iran is prone to earthquakes. Many people have died in recent years, most notably in the city of Bam in 2003, killing 30,000. In February 2005, an earthquake measuring 6.4 on the Richter scale struck Zarand in southeast Iran. In March 2006, several earthquakes occurred in Restan province, western Iran, killing around 100 and injuring 1200.

Criminal Penalties: While in a foreign country, a U.S. citizen is subject to that country's laws and regulations, which sometimes differ significantly from those in the United States and may not afford the protections available to the individual under U.S. law. Penalties for breaking the law can be more severe than in the United States for similar offenses. Persons violating Iranian laws, even unknowingly, may be expelled, arrested or imprisoned. Fines, public floggings, and long prison terms are common. Former Muslims who have converted to other religions, as well as persons who encourage Muslims to convert, are subject to arrest and possible execution. Drinking, possession of alcoholic beverages and drugs as well as public displays of affection with a member of the opposite sex or having sexual contact outside of marriage are considered to be crimes. Relations between non-Muslim men and Muslim women are illegal. Adultery, sex outside of marriage and gay sex are all illegal under Iranian law and carry the death penalty. DVDs depicting sexual relations and even women's magazines are forbidden. Penalties for possession, use, or trafficking in illegal drugs in Iran are severe and convicted offenders can expect long jail sentences and heavy fines. Iran executes many people each year on drug-related charges. Engaging in sexual conduct with children or using or disseminating child pornography in a foreign country is a crime, prosecutable in the United States.

U.S. citizens in Iran who violate Iranian laws, including laws that are unfamiliar to Westerners (such as those regarding the proper wearing of apparel), may face severe penalties.

The Iranian Government reportedly has the names of all individuals who filed claims against Iran at the Iran-U.S. Claims Tribunal at The Hague pursuant to the 1981 Algerian Accords. In addition, the Iranian Government reportedly has compiled a list of the claimants who were awarded compensation in the Iran Claims Program administered by the Foreign Claims Settlement Commission. The Iranian government is allegedly targeting award-holders who travel to Iran.

It is reported that upon some claimants’ entry into Iran, Iranian authorities question them as to the status of payment of their respective awards with a view to recouping the award money. It is also reported that the Iranian Government has threatened to prevent U.S. claimants who visit Iran from departing the country until they make arrangements to pay part or all of their award.

Children's Issues: For information on international adoption of children and international parental child abduction, see the Office of Children's Issues website at http://travel.state.gov/family.

Registration and U.S. Interests Section Location: There is no U.S. Embassy or Consulate in Iran. The Embassy of Switzerland serves as the protecting power for U.S. interests in Iran. The U.S. Interests Section at the Swiss Embassy is located at Africa Avenue, West Farzan Street, no. 59, Tehran. The local telephone numbers are 021-8878-2964 and 021-8879-2364, fax 021-8877-3265,e-mail: tie.vertretung@eda.admin.ch. The workweek is Sunday through Thursday. Public service hours are 8:00 am—12:00 noon. The Interests Section does not issue U.S. visas or accept visa applications.

Americans living or traveling in Iran are encouraged to register with the nearest U.S. Embassy or Consulate through the State Department's travel registration website so that they can obtain updated information on travel and security within Iran. Americans without Internet access may register directly with the nearest U.S. Embassy or Consulate. By registering, American citizens make it easier for the U.S. Interests Section to contact them in case of emergency.

International Adoption

February 2008

The information in this section has been edited from a report of the State Department Bureau of Consular Affairs, Office of Overseas Citizens Services. For more information, please read the International Adoption section of this book and review current reports online at http://travel.state.gov/family.

Disclaimer: The information in this flyer relating to the legal requirements of specific foreign countries is based on public sources and current understanding. Questions involving foreign and U.S. immigration laws and legal interpretation should be addressed respectively to qualified foreign or U.S. legal counsel.

The Department of State has received inquiries from American citizens concerned about the plight of the children affected by the earthquake in Bam, Iran and wondering about the possibility of adoption. The Department of State shares this humanitarian concern for the children of Bam, Iran and applauds American citizens’ desire to assist them in their time of need. However, at this time, it is not possible for U.S. citizens to adopt Iranian children, for several reasons. The international standard in a crisis is to keep children as close to their family members as possible. It can be extremely difficult to determine whether children whose parents are missing are truly orphans. It is not uncommon in a catastrophic situation for parents to send their children out of the affected area, or to become separated during an evacuation. Even when children are indeed orphaned or abandoned by their parents, they are often taken in by other relatives. Staying with relatives in extended family units is generally a better solution than uprooting the child completely.

The United States Interests Section of the Swiss Embassy at Tehran has provided the following information regarding adoptions in Iran. The information is based on informal discussions with an adviser at the Nationality and Refugees Department of the Iranian Ministry of Foreign Affairs. In accordance with current Iranian practice, adoptions by parents residing outside of Iran are possible provided the adoptive parents are Iranian citizens and fulfill all the other required conditions for adoption. Applications from close family members have the greatest chance of being approved. Before an adoption can take place, strict rules are applied in order to protect the children and to establish the suitability of prospective adoptive parents. The process is complicated and time-consuming. Moreover, only the Iranian Welfare Organization and the appropriate court can decide each case on its own merits in the best interest of the child. Muslim children will be given exclusively to Muslim parents. Christian parents may adopt children of Christian denominations.

Iranians living abroad can file adoption applications through relatives living in Iran. Applications must be submitted to the Iranian Welfare Organization. After a child has been placed with a family, surveillance by Iranian authorities continues and periodic checks are made to ensure the child's physical and mental wellbeing.

There are still ways in which U.S. citizens can help the children of Bam. Many nongovernmental organizations (NGOs) say that what is needed most at this time are financial contributions. Individuals who wish to assist can do the most good by making a financial contribution to an established NGO that will be well placed to respond to Iran's most urgent needs.

The Red Cross is working through the International Committee of the Red Cross (ICRC) to provide humanitarian assistance in Iran. The Red Cross and ICRC do assessments to determine needs and use monetary donations where the need is the greatest. To contact them, call 1-800-HELP-NOW. There is no mechanism to direct money to a specific child or person. The website http://www.red-cross.org/ has more information on directed contributions. The United States Agency for International Development (USAID) Web site, http://www.usaid.gov/iran, provides information on how individuals can assist.

International Parental Child Abduction

February 2008

The information in this section has been edited from a report of the State Department Bureau of Consular Affairs, Office of Overseas Citizens Services. For more information, please read the International Parental Child Abduction section of this book and review current reports online at http://travel.state.gov/family.

Disclaimer: The information in this flyer relating to the legal requirements of specific foreign countries is provided for general information only. Questions involving interpretation of specific foreign laws should be addressed to foreign legal counsel.

Since the mid-1970's, when we first began compiling statistics on this subject, the Department of State has taken action in more than 4,200 cases where children have either been abducted from the United States or wrongfully detained in a foreign country. We have provided information in response to thousands of additional inquiries regarding child custody, visitation rights and effective abduction prevention techniques such as supervised visitation.

The Office of Overseas Citizens Services has taken an active role in almost 80 cases of children taken to or wrongfully retained in Iran. To our knowledge, the majority of these cases have not been resolved. However, in a number of cases, the left-behind parent has kept open the lines of communication, negotiated with the abducting parent, and eventually persuaded the other parent to travel out of Iran with the children.

The United States severed diplomatic and consular relations with the Government of Iran on April 7, 1980 as a result of the events surrounding the seizure of our Embassy in Tehran, Iran on November 4, 1979. In April of 1980, the United States Government formally asked the Swiss Government if it would assume diplomatic and consular representation of the United States in Iran. The Swiss agreed to perform specific consular and administrative functions on behalf of the U.S. Government.

One of their responsibilities is to provide consular services to children who have been taken by one parent to Iran without the other parent's knowledge or consent. In this regard, Swiss officials are permitted to ascertain the child's welfare, process applications for U.S. passports and to inform appropriate officials if there are allegations of child abuse. However, the Iranian government has placed strict limits on the ability of Swiss diplomats to intervene in such cases because they do not recognize the concept of dual nationality and therefore, when one parent is an Iranian citizen, consider the children involved to be Iranian citizens only.

Swiss diplomats in Iran do not have the authority to take custody of and return a child to the United States, just as foreign diplomats in the U.S. cannot remove children from this country. Such an action would be considered kidnapping under local law.

If you are concerned about a potential abduction, one of the first steps you should take is to notify the Department's Office of Legal Assistance and Citizenship Appeals. That office, which can be reached on (202) 326-6178, can block the issuance of a U.S. passport in your child's name upon submission of a court order giving you sole custody or prohibiting the child's departure from the U.S. without permission of the court. That office can also tell you whether your spouse has already applied for and obtained a passport for your child. However, if a passport has already been issued for the child, that office cannot revoke the passport or prevent its use.

If the child's father is an Iranian citizen, the child is considered an Iranian citizen under Iranian law and could travel abroad on an Iranian passport. There is nothing the Department of State can do to prevent the issuance of an Iranian passport by the Iranian Interests Section of the Embassy of Algeria.

You may wish to notify the Iranian Interests Section that you would object to your child receiving a passport without your consent. At that time, you could ask whether they have already issued a passport for the child. The address and the telephone number of the Iranian Interests Section of the Embassy of Algeria are: 2209 Wisconsin Avenue, N.W., Washington D.C. 20007; (202) 965-4999.

Unfortunately, it has been our experience that a parent encounters little or no difficulty obtaining travel documentation from the Interests Section for a dual U.S.-Iranian citizen child, despite the existence of a U.S. court order barring departure without the court's consent.

As you may already know, a custody decree issued by a court in the United States has no force or effect in a foreign country. When a child is abducted by a parent, the deprived parent must usually initiate legal proceedings in the foreign country to regain custody of the child or to enforce visitation rights. However, the difficulties in recovering a child from an Islamic country without the full support and consent of the father can be insurmountable.

It is the Department's understanding that in Iran, all matters concerning family law are governed by the religious courts. While you would be free to seek legal custody through the Iranian religious courts, you should be aware that Islamic courts rarely, if ever, grant custody of children to a parent who will not raise them as Muslims, does not plan to remain in Iran or has remarried. Islamic courts attach great importance to having children reside near their father so that he can visit frequently and over-see their upbringing. Even if the mother is granted custody, (The children would still need his permission to leave the country).

Currently, the only treaties which have any application to abductions of children from the United States are the Hague Convention on the Civil Aspects of International Child Abduction and the extradition treaties which the United States has with individual countries. Iran is not a party to the Hague Convention, and since the U.S. and Iran do not maintain diplomatic relations, there is no bilateral treaty in effect which would cover parental child abduction.

The information in this section has been edited from a report of the State Department Bureau of Consular Affairs, Office of Overseas Citizens Services. For more information, please read the International Parental Child Abduction section of this book and review current reports online at http://travel.state.gov/family.

Travel Warning

January 3, 2008

The Department of State continues to warn U.S. citizens to carefully consider the risks of travel to Iran. Dual national Iranian-American citizens may encounter difficulty in departing Iran. This Travel Warning supersedes the Travel Warning for Iran issued May 31, 2007.

Some elements of the Iranian regime and the population remain hostile to the United States. As a result, American citizens may be subject to harassment or arrest while traveling or residing in Iran. Recently, Iranian authorities prevented a number of Iranian-American citizen academics, journalists, and others who traveled to Iran for personal reasons from leaving for several months, and in some cases detained and imprisoned them on various charges, including espionage and posing a threat to national security. Americans of Iranian origin should consider the risk of being targeted by authorities before planning travel to Iran. Iranian authorities may deny dual nationals access to the United States Interests Section in Tehran, because they are considered to be solely Iranian citizens.

The Iranian regime continues to repress its minority religious and ethnic groups, including Bahai, Arabs, Kurds, Azeris, and others. Consequently, some areas within the country where these minorities reside, including the Baluchistan border area near Pakistan and Afghanistan, the Kurdish northwest of the country, and areas near the Iraqi border, remain unsafe. Armed attacks on the road between Bam and Kerman in May 2007 also render this area unsafe.

Large-scale demonstrations have taken place in various regions throughout Iran over the past several years as a result of a sometimes volatile political climate. U.S. citizens who travel to Iran despite this Travel Warning should exercise caution.

The U.S. government does not have diplomatic or consular relations with the Islamic Republic of Iran and therefore cannot provide protection or routine consular services to American citizens in Iran. The Swiss government, acting through its Embassy in Tehran, serves as protecting power for U.S. interests in Iran. Neither U.S. passports nor visas to the United States are issued in Tehran. The Iranian Government does not recognize dual citizenship and generally does not permit the Swiss to provide protective services for U.S. citizens who are also Iranian nationals. U.S. citizens of Iranian origin who are considered by Iran to be Iranian citizens have been detained and harassed by Iranian authorities. Former Muslims who have converted to other religions, as well as persons who encourage Muslims to convert, are subject to arrest and prosecution.

Americans who travel or reside in Iran despite this Travel Warning are strongly encouraged to register through the State Department's travel registration website, https://travelregistration.state.gov. If they are in Tehran, American citizens may also register in person at the U.S. Interests Section of the Swiss Embassy at Africa Avenue, West Far-zan Street, no. 59, Tehran. The local telephone numbers are 021-8878-2964 and 021-8879-2364, fax 021-8877-3265, e-mail: tie.vertretung@ eda.admin.ch.

U.S. citizens should also consult the Department of State's Country Specific Information for Iran, and the current Worldwide Caution and Middle East and North Africa Travel Alerts, which are located on the Department's Internet web site at http://travel.state.gov. American citizens may also obtain updated information on travel and security conditions by calling 1-888-407-4747 toll-free in the United States or Canada, or, from overseas, 1-202-501-4444.

IRAN

IRAN. The art of sophisticated cookery in Iran can be traced to antiquity. It has, according to existing literature, preserved its basic mode of preparation for more than a thousand years, enhanced by refinement of dishes and new recipes created in the kitchens of royalty and ordinary folk. Iranian food is prepared with such delicate subtlety that every ingredient used can be tasted and every aromatic spice added can be appreciated.

Food of Ancient Persia

History. The Persian Achaemenid empire, founded by Cyrus the Great in 549 B.C.E., dominated the ancient world for almost two centuries. At the height of its power it extended from the Indus in the east to Asia Minor and Egypt in the west, uniting Medes, Persians, and Parthians, as well as many other tribes and peoples, in fealty to the dynasty. Presumably the people living in that vast expanse with its varied climates each formed their own culinary culture according to indigenous food products, naturally available, grown, or reared. Yet all cultures converged at the Achaemenid court and were elaborately manifested at the table of the king of kings.

There are no known recipes left of that period. The references to food in the Avesta and Elamite tablets from Persepolis dated 509–494 B.C.E. indicate that the Achaemenid diet consisted of dairy products from cows, sheep, goats, and mares; meat from oxen, rams, goats, and wild or reared fowls; grains for making bread; ales; wines; dried fruit; and nuts and seeds also used for pressing oil.

Each season, the nomad kings and the court moved from capital to capital. Winter was spent in Babylon or Susa, where the wine was fermented from dates and grapes; spring in Ecbatana, where meat, dairy products, and herbs were ample; and autumn in Persepolis, where fruit, wild vegetables, and seeds were in abundance.

Narratives by Greek authors of the period reveal the sumptuous preparation and the abundance of food in that fertile realm. Ctesias (405–397 B.C.E.) and Dinon indicate that 15,000 men ate daily in the court of the Achaemenid king of kings. The Greek writer Polyaenus (second century C.E.) recounts that the food brought to the court for distribution as well as for the preparation of three meals a day was formulated by Cyrus and engraved on a bronze column. It included great quantities of different grades of wheat, barley, and rye, floured or treated; grains of corn and parsley; salt; male livestock; gazelles; poultry; geese; pigeons; small wild birds; dairy; watercress; onions and garlic; pickled radishes and beetroots; cured capers; juice of sweet apples; conserve of sour pomegranates; honey; oils of almond, terebinth, sesame seed, and acanthus; raisins dark and light; nuts; sweetened seeds; vinegar; mustard, anise, cumin, celery, and safflower seeds; saffron; cardamom; and dill flower. Xenophon (430–355 B.C.E.) notes that what was served at the king's table was prepared in exquisite taste by expert cooks and bakers who were engaged in a constant search for new recipes and would invent a variety of pastries and cakes.

Herodotus (fifth century B.C.E.) relates that the Persians ate varied desserts and sweets. Birthdays were celebrated by giving great feasts. Side dishes, served at regular intervals, punctuated the introduction of the principal dishes. Large animals, including big fowl like ostrich, were stuffed and roasted whole; birds were stuffed and seasoned with capers. Meat cured in sophisticated fashion was served.

The Greek historian Diodorus Siculus (first century B.C.E.) reflects on the variety of delicacies brought from Persia to Babylon, in particular fish from the Persian Gulf. Polyaenus remarks on the exquisite mixture of cardamom and other spices, vinegar, and pepper, and upon the use of aromatic herbs from which oil was also extracted for medicinal purposes.

It is said that soldiers normally received meat and bread, but on long journeys and campaigns were sustained by onion soup and bread. To this day eshkaneh, basically made with onions, flour, and turmeric, is cooked in different parts of Iran. Seasonal or dried herbs and fruit—dried or fresh—are added, and, combined with one or two eggs, the dish can serve a big family. It remains the food of the populace, while the stuffed beast or fowl, boghlameh, is served mainly at tribal feasts by those who can afford the luxury. Pierre Briant, quoting Polyaenus, remarks in Histoire de l'Empire Perse (p. 300) that when Alexander the Great defeated Darius III and seized Persepolis (331 B.C.E.), ordering the bronze pillars to be destroyed, he said with laughter that such a diet weakens the body and the mind and was the cause of the defeat of the Persians.

Following Alexander's demise, his successors, the Seleucid Greek rulers (323–64 B.C.E.), were overthrown by the Parthians of western Iran. The Parthians (250 B.C.E.–224 C.E.) revived the national spirit that came to full flowering under their successors, the Sassanians (224–652 C.E.). The culinary culture of the aristocracy and preparation of food in this period are revealed in a rare Pahlavi manuscript, "King Husrav and His Boy" (translated: J. Unvala, Paris), a reliable source that withstood the destruction of libraries by the Islamic army in 636 or 637. In the text Khosrow II and a companion discuss, among the pleasures of life, the variety of Epicurean cuisine. Some dishes are in certain ways similar to what is eaten in the early twenty-first century in certain parts of Iran. For example, the boy recommends that the meat of a two-month-old kid fed on mother's milk and cow's milk marinated with herbs be cooked and served with whey (kashk ). In Yazd (central Iran), Kerman, and Azerbaijan, bōzghōrmēh is still a popular dish. It features chunks of goat's meat or mutton as a dominant substitute, fried with chopped onions, seasoned with turmeric and cinnamon, sprinkled with tarragon and mint or saffron, and topped by thick yogurt or kashk. As for sweets, almond, walnut, and pistachio are used in making delicate cookies, as they were many years ago. A jelly made with quince juice is now called mōjassamēh-ye beh. In jams and preserves the peel of baalang, a large citrus fruit, is still popular in Fars and Gilan provinces. Quince jam continues to be made in most parts. Cucumber and walnut jams and pickles are remembered recipes in Qazvin.

Other later sources, too, elaborate the sophisticated Sassanid cuisine. An eleventh-century scholar, Tha'alebi of Neishapur, describes in his "History" a variety of dishes including wild birds and other game, fish, lamb, and veal marinated in vinegar, mustard, stock, garlic, dill, and green and black cumin, or in yogurt, flavored with spices, and stewed, broiled, or roasted according to different recipes; barbecued chicken flavored with cane sugar, skewered and grilled; stuffed vine leaves; puddings made of rice, milk, honey, butter, eggs, and rosewater; and delicacies and sweets using countless aromatics. He mentions that peasants marinated their meat in brine and pomegranate juice.

Festivals. Festivals were frequent in ancient Persia. For the ancient Persian herdsmen and farmers, the revival of nature in the spring was a terrestrial renewal of life, so people equated the New Year with the spring equinox. Before the equinox, reverence for the seven Ēmshāspands (archangels) in the Zoroastrian religion was symbolized in seven cereals and pulses grown in clay pots to predict the quality of the next harvest. In the five leap days (the year being 360 days) preceding Nōwrūz (New Year's festival), festivities would begin. Food, including milk and honey, sweetmeats, nuts, and dried fruits, was prepared and bonfires were lit on rooftops to attract the Farvahars, or guardian angels of the ancestors, who would descend for the annual reception in which wining and dining continued for five days following Nōwrūz.

Yaldā is still celebrated, marking the birth of Mithra on the longest night of the year. Throughout the long night of Yaldā, fresh fruit specially preserved for the occasion, seven kinds of nuts, and a range of dried fruit were consumed in a joyous vigil held to drive out the darkness in anticipation of the sun's rebirth. Apart from Mēhrgān or Sadēh little is known of other such festivals.

After the Arab invasion in the seventh century, a great number of Zoroastrians migrated to India, taking with them their culinary culture. However, the art of Persian cookery and the etiquette of eating (ādāb-é sōfrēh ) at a spread (sōfrēh ) laden with a colorful array of food survived. These, in later years, highly influenced the Arab, the Ottoman, and the Indian culinary cultures.

In the eighth century, Iranians who helped the Abbasid caliphs gain power passed on the refined Sassanid recipes to Baghdad. This is apparent in a range of cookery books written in Arabic in subsequent centuries.

In the fifteenth century, the haute cuisine that evolved at the Ottoman court was in the style of the Teimurid court of Persia. From the sixteenth century, when a descendant of the Teimurid dynasty in Iran established the Moghul empire in Delhi, the first cookery books, written in Persian and Urdu by Iranian scholars of the imperial court, appeared. In parallel, cookery books were written in Iran by master chefs in the Safavid court and in the nineteenth century in the Qājār court of Na-ser od-Dīn Shāh, showing further refinement in the art of cooking, of rice, in particular.

Modern Iranian Cuisine

Rice. Rice in Iran is steamed to a unique perfection, bringing out its full flavor and fragrance, turning the grains into light, fluffy chēlōw (plain rice) that may be eaten with khōrēsh (stew) or grilled meat (chēlōw kabāb ). Rice can be steamed with meat, herbs, vegetables, sour cherries, or pulses in many varieties, colors, and mixtures (pōlōw ) as a crisp crust (tah-dig ) is formed at the bottom of the cooking vessel. It can be garnished with saffron, barberries, and slivers of orange peel, pistachio, and almond. Rice with beaten eggs, yogurt, and saffron, steamed with layers of cooked meat, eggplant (aubergine), or spinach turns into yet another sumptuous dish known as tahchin.

The best rice is grown in the Caspian provinces of Gīlān and Māzandarān; it is also cultivated in limited quantity in the Lenjān district of Ēsfahān and along the Qēzēl Ōzan River near Zanjān. The major grades of quality long-grain rice, with their elongated form and characteristic fragrance, Sadri Dōmsīah and Tārōm, are the best known for perfume and taste.

Stews. Iranian cuisine in general is the art of cooking the available nutrients in a way that pleases the eye and the palate and balances the functions of the body. Recipes consider food's properties and elements to formulate an equation in which the ingredients blend harmoniously, each counterbalancing the excess effect of the other on the digestive system.

Khōrēsh, derived from the Persian verb khōrdan (to eat), is a kind of stew prepared to these rules. The base for every khōrēsh is fried onions (garlic is added in the northern and southern regions), meat or poultry, the appropriate spices and seasoning. These are left to simmer in water to a desired consistency, then lightly fried vegetables, herbs, or fruit are added. Depending on vegetables and herbs in season, countless varieties are made all over Iran. For example, chopped mint and parsley would make khōrēsh-é na'najafari with celery, or, in the spring, rhubarb, greengages, acanthus, or young green almonds with verjuice (sour grape juice) as seasoning. The famous khōrēsh-é fēsēnjān, which turns into a thick light or dark brown sauce, is made of ground walnuts seasoned with pomegranate juice or paste and has a sweet and sour taste. The cooling effect of pomegranate juice balances the warm and rich property of walnuts. This is an autumn and winter khōrēsh customarily made with duck, or with chicken or meatballs as substitutes. In late autumn it can be made with ripe walnuts and pomegranate juice. In winter chunks of eggplant or pumpkin, dried prunes, and apricots may be added. It is then called mōtanjan. A further derivation is anār-āvīj (pomegranate paste or juice and herbs), prepared in the Caspian region. Another speciality is khōrēsh-é ghōrmēh-sabzi made with mixed herbs and red kidney beans (in the south, blackeyed beans) with whole dried limes used for fragrance, freshness, and seasoning. Also common is khōrēsh-e gheimeh (diced meat) with split peas, served plain or with fried potato sticks and dried lime as seasoning or eggplant, zucchini (courgettes), or celery with sour grapes as seasoning, quinces, or apples with sweetened vinegar as seasoning, etc. A luxury, known from the imperial court of the Qājārs (nineteenth century), is gheimēh-mōrassa' (jeweled diced meat), which in place of split peas uses skinned whole pistachios with ample saffron for aroma and color.

Khōrāk and side dishes. Khōrāk, also derived from the verb khōrdan ('to eat') cooked with or without meat, cover an extensive range and reflect the significant contributions of Gīlān and Azerbaijan provinces. Among these dishes are kabāb, a variation of charcoal-grilled meat, fowl, or fish; shāmi —meat cooked with split peas pounded and kneaded with eggs, ground cumin, and saffron, shaped in a round patty and deep-fried; kūkū, a form of thick puffed omelette or soufflé of different vegetables or herbs; dōlmēh— stuffed vegetables or vine or cabbage leaves; tās -kabāb, meticulously arranged layers of onion, meat, tomatoes, carrots, eggplant, potatoes, and quinces or apples (depending on the season), sprinkled with cardamom and cinnamon, chopped dried lime, and prunes steam-cooked in its own juice on low heat; kashk-bādēm-jān —fried eggplant topped with kashk (whey) and tastefully garnished; mīrzāghāsēmi, grilled eggplant cooked with garlic, tomatoes, and eggs. Side dishes are prepared with various vegetables cooked or raw and mixed with yogurt seasoned with aromatic herbs.

Fish. Fish is cooked in a variety of ways in the Caspian Sea provinces and alongside the Persian Gulf and the Arabian Sea. In the Khuzistan region well-spiced baked fish seasoned with tamarind is among the specialities whereas in the Caspian area it is barbecued or stuffed with herbs, including dried pomegranate seeds, baked and served with bitter oranges. The Caspian caviar is an important item for export, and the large grey and the rare golden of the Iranian coast are famous among connoisseurs.

Bread. Bread or nān is revered as a gift from God. Except in the rice-growing areas along the Caspian coast, it is the staple food of Iranians. Khōrēshs and khōrāks are eaten with nān as well as rice. Made in a flat form, the most common varieties of bread are sangak (baked on pebbles), tāftūn, thin lavāsh, thick barbari, nān -é shīrmāl (dough mixed with milk), and crispy nān-é rōghani (dough mixed with butter).

Soups. Āsh is the general name for a thick soup made with herbs, rice, or pulses with or without meat, served plain or variably seasoned. It is another prominent and universal feature of Iranian cuisine. The recipe for āsh-e sac (spinach soup) has been passed down from the Sassanid era. Āsh cooked using barley, wheat, or noodles and kashk is a convenient dish in tribal life. Ābgūsht (literally meat juice) is made with mutton, onions, turmeric, chickpeas, pinto beans, tomatoes, potatoes, and dried lime; the stock is separated and the rest is pounded into a paste. It is the sustaining food of all classes. Other variations of ābgūsht are derived from this basic form. Another soup is known as kallēh-pācheh (sheep's head and pig's feet in a bouillon); when homemade, tripe is often added. Halīm is a homogeneous porridgelike soup made with wheat and pounded meat of lamb, turkey, or goose, garnished with melted butter and powdered cinnamon. Kūftēh refers to tiny to very large meatballs in onionbased soup. The kūftēh tabrīyi of Azerbaijan is so large that it can hold a chicken, an egg, prunes, barberries, orange peel, and almonds in its center.

There are cold soups for summer. Ābdūgh, a soup made from cucumber, raisins, and herbs in diluted yogurt is everybody's meal. Ēshkanēh, made with fresh fruit such as sour cherries, is both refreshing and filling.

Confections and preserves. A common confection is hālva, prepared from flour, butter, diluted sugar, saffron, and rosewater. Tar hālva, a sophisticated version of hālva, is prepared with ground rice instead of flour and with crushed orange peel or yellow rose petals. Other well-known desserts are shōllēhzard, made with rice, water, butter, sugar, saffron, and almond slivers and garnished with cinnamon and crushed pistachio; masqati, made with starch, water, sugar, butter, cardamom, and almond slivers; and yakhdarbēhēsht, prepared with starch, milk, and sugar. All are perfumed with rosewater or orange-blossom water.

Jams, preserves, torshis (pickles), and sherbets (soft and refreshing cold drinks) such as sērkangēbin, made of sugar water, vinegar, and mint, and others prepared with the juice of rhubarb or various fruits, are prominent features of Iranian culinary culture. The techniques of long conservation of herbs, vegetables, meat, fish, and dairy have been passed on from one generation to another and have been developed in homes mainly by women, the keepers of the household.

Cookies and pastries. Cookies and pastries in Iran are generally delicate in form with a subtle aroma, prepared with variation on basic recipes in different regions. Bāghlava, made with phyllo pastry, finely ground almonds or pistachio, sugar and light syrup, flavored with cardamom and rosewater, finely cut into small diamond-shaped pieces, is a popular confection. Now commercially produced, it was conventionally a homemade product except in Yazd, where confectioners, as a cherished tradition, have specialized in its production. Similarly, numerous petit fours, made with finely ground rice or chickpeas or coconut or almond, are produced. Apart from Yazd, as examples, Esfahān specializes in the production of gaz (nugat); Qum in sōhān (a kind of fudge made of germinated wheat, garnished with crushed pistachio); Kērmānshāh and Qazvīn in nān-é bērēnji (rice cookies) and kāk or nān-é yōkhēh (a fine phyllo made of flour, butter, eggs, and milk, rolled and cut into small pieces, baked and sprayed with powdered sugar); the specialty of Shīrāz is nōghl (sugared slivered almond or pistachio, or muskwillow seed). In rural and tribal areas, kōlūcheh, a kind of shortbread, is popularly produced, mainly for festivities.

Street food. Hot steaming beetroots, grilled pumpkins, baked potatoes, boiled broad beans, and cooked lentils served with powdered Persian marjoram seed sold by peddlers in winter, and liver kabābs rolled in flatbread with or without fresh herbs and chopped onions sold all year round are characteristic features of the popular culture. As further examples, a number of puddings and sweetmeats as well as dried barberry or prunella soaked in water for the juice can be added to the list.

Persian food has not reached the international market. Until the early decades of the twentieth century, people holding high functions or the aristocracy saw to their business in the outer quarters of their home. They were fed together with their employees, assistants, and guests by the kārkhānēh (workshop), as the kitchen was known in a big household. It was in such kitchens that great chefs trained cooks who specialized in certain branches of cooking and accepted apprentices to ensure the continuity of the tradition.

Commercial sale of food was limited to qahvēhkhē-neh (coffee or, in fact, tea houses), where basic dishes are prepared; chēlōw-kabābīs, where only rice and kabobs are served; and certain shops that function only very early in the morning or late in the evening, selling one item like rice pudding, halīm, or tripe. Restaurants are a post–World War I phenomenon mainly introduced by Armenian, Caucasian, and Russian émigrés from the former Soviet Union. They introduced their own cookery rather than commercializing the Persian cuisine.

Feasts and rituals. Cookies, dried fruit, nuts, and sweets are prepared for Nōwrūz (the New Year festival). The traditional dish for New Year's Eve is sabzi-pōlōw (rice with herbs) with fried or smoked fish. On New Year's Day rēshtēh-pōlōw (noodles with rice), spiced and artfully garnished, is served. Festivities end with a picnic on the thirteenth day, at which āsh-é rēshtēh (noodle soup made with herbs, pulses, and kashk ) and bāghēla-pōlōw (rice steamed with broad beans and dill) are the main features.

Observation of religious mourning is customary during the first ten days of the first month of the lunar Islamic calendar to commemorate the martyrdom of Hossein, the grandson of the prophet Muhammad. The occasion includes offerings in the form of food and puddings to the poor. Rice and khōrēshs are served in the evenings. On the tenth day, the well-to-do offer puddings such as shōllēhzard or hālva to ensure good health for the loved ones. In the month of Ramadan a whole range of sophisticated condiments of fine quality are made available for those fasting and feasting during daylight hours.

See also Bread; Feasts, Festivals, and Fasts; Herbs and Spices; Herodotus; Islam; Mesopotamia, Ancient; Rice; Soup; Stew; Zoroastrianism.

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Maryam Matine-Daftary