Banks to Guarantee NDFI Loan Repayment

The Iranian Parliament on Wednesday passed a bill requiring banks and agent funds to guarantee the repayment of loans extended by the National Development Fund of Iran.

Lawmakers approved a measure that specifies that banks and funds must ensure NDFI's resources are fully reimbursed by loan takers, IBENA reported.

The parliament also approved another measure that supports the development and creation of sustainable employment in rural areas by using NDFI resources.

 According to this clause, in order to achieve long-term targets envisioned by Resistance Economy–a set of principles aimed at curbing the economy’s oil dependency and promoting the production sector—the parliament allows NDFI to withdraw $1.5 billion from its resources.

This clause, which was considered by some to contravene the sixth economic development plan (2017-22), was approved by two-thirds of votes.

NDFI, Iran’s sovereign wealth fund, has $91 billion in reserves. The fund finances development projects using oil revenue deposits.

As per the budget bill for the current Iranian year, the government is tasked with depositing 30% of revenues earned from oil and gas exports in NDFI, up from 20% as per the budget law of the fiscal 2016-17.