Have Iran’s industries gone bankrupt? The government’s answer is no, as it speaks about achieving its goals and the fivefold increase in investment. But experts and private sector actors provide a different view: the capital markets are shut down, and that state-owned firms and institutions break the rules of market competition. To all of this we must add the summer’s power shortages, which forced the energy ministry to ration industrial power supply to meet domestic consumers’ demand. As a result, many factories have either practically shut down or are operating under capacity.

A similar problem occurred last summer when the government cut off gas supply to industries in order to meet domestic consumers’ demand during a cold wave. At that time, the government promised to reimburse the industrial sector for the resulting damages; a promise that was never fulfilled. This time, electricity was cut off and the government did not make any promises either.

According to many experts and economists, the majority of the country’s industries are in crisis. The crisis is so severe that the head of the administration, who often attempts to cover up problems or even claims exactly the opposite, was forced to set up a committee to oversee industrial development several months ago.

But the problem runs much deeper. According to Donyaye Eghtesad (The Economic World), “Iran’s largest automobile manufacturer, Iran Khodro, is experiencing tough times. The company’s huge debt has now reached a level that it has forced the company into selling some of its assets. Iran Khodro, which was for a long time among Iran’s most profitable companies, is now facing dissolution under the huge weight of its debt. For the first time in 45 years, the company has not only not made any profits, but actually in red, according to a recent posted report.”

The problem is not limited to Iran Khodro. According to Pool daily, IRALCO (Iran Aluminum Company), which produces nearly half of Iran’s aluminum, is suffering from a similar problem and is facing an extreme crisis.”

According to Aftab website, “Although Iranian industries have faced many problems in recent years including low monetary supply and high value-added tax rates, among others, no problem has been as critical as the power shortage…. Many industrial firms are currently operating at half of their production capacity, or even lower.”

But despite these persistent problems, a government official in charge of industrial development at the Ghazvin province said that any firm operating at a loss would be shut down without hesitation, according to the Fars news agency. This industrial manager said, “Don’t worry about industrial closures, because any industrial firm operating at a loss must be eliminated from the production chain…. There is no room for concern.”