Domestic Economy

Majlis Allocates $300m to Knowledge-Based Firms

Majlis Allocates $300m  to Knowledge-Based FirmsMajlis Allocates $300m  to Knowledge-Based Firms

The parliament on Tuesday decided to allocate $300 million from the National Development Fund of Iran (NDFI) to support knowledge-based companies.

The decision is in line with the objectives set out in the Protection of Knowledge-Based Companies and Institutions’ Rights and Commercialization of Innovations and Creations Act, approved in 2010, IRNA reported.

Iran’s economy has been going through a transition from the traditional businesses towards more knowledge-based activities. An article in Iran newspaper suggests that while Iran’s economy has traditionally been more inclined towards brokerage rather than production activities, the scenario is changing with the emergence of a new generation of Iranian investors.

“A new generation of educated billionaires seem to be entering the market, who will presumably engage in knowledge-based activities,” the newspaper quoted chairman of the Science and Technology Park at the University of Tehran, Mohammad Jafar Sedigh as saying.

  Added Value

Knowledge-based enterprises can make a significant contribution to overall economic development by increasing added value among other things, experts say.  

Mehdi Elyasi, general director of the Knowledge, Industry, and Market Coordination Center (affiliated to the Vice-Presidency for Science and Technology) believes that knowledge-based enterprises are ‘the true champions of the economy.’

Knowledge-based economy is a system of consumption and production based on intellectual capital, in which a significant part of a company’s value may consist of intangible assets, mainly the value of its workers’ knowledge (intellectual capital).

The scope of a knowledge-based economy is not limited to high-tech industries in the field of information technology, nanotechnology and biotechnology, said Sedigh, noting that the reverse is, however, possible, meaning that a given high-tech firm could be knowledge-based.


In global categorizations, “knowledge-based activities are those producing above seven percent value added,” said the university lecturer. According to this classification, “even a dairy factory can be knowledge-based,” he added.  

Knowledge-based enterprises progress via three channels, namely technology, government support, and market potential, said Elyasi, adding that these enterprises must have no intention of intervening in market processes, “as any such intervention will distort market mechanism.”

Setting up unions in the private sector for supporting knowledge-based enterprises can help develop such enterprises, he said, adding that the Vice-Presidency for Science and Technology is ready to lend its support to these unions.

The focus of the unions should be to spur production and create market for knowledge-based enterprises, as well as advice the government regarding the use of technologies, said Elyasi.