Iran to remove fuel subsidies gradually

The Iranian government has drawn up legislation to gradually remove subsidies on fuel and water but will compensate people with cash payments, the local press reported yesterday.
Under the bill, subsidies will be removed over the next three years on goods such as water, petrol, diesel, kerosene and liquefied petroleum gas, the Sarmayeh newspaper said.
But to compensate for the higher prices of such vital supplies, direct cash payments will be made to Iranians, it said.
The bill has yet to be approved by parliament but some MPs have already warned it could add to the problem of soaring inflation, which was running at 29 percent in September, according to official figures.
Direct and indirect subsidies for goods in Iran currently amount to as much as 100 billion dollars a year, Sarmayeh said.