The Iran, even before the revolution due to the increase in the price of oil caused profound economic changes, had tried (since 1960) to diversify its production and has continued on this path, favored by being able to count on a population numerous (1976 census: 32,200,000 residents, with an annual increase of 2.5%) and on copious manpower. The gap between the urban and rural populations is increasingly accentuated, as is the attraction exercised by the major cities and industrial centers of Kexmānshāh, Isfahān, Yazd. Teherān went from 1.5 million (1956) to 3.4 million (1973). The fifth five-year plan (21 March 1973 – 20 March 1978), equipped with ample means, aims to reduce the imbalances between city and countryside and foresees an annual increase of 13% of the national income. Violent earthquakes caused extensive damage in December 1964 in Iran southern (15,000 victims), in September 1968 in Khorāsān (20,000) and in April 1972 in Fārs (5000).
Land reform and agriculture. – In the period 1963-71 the so-called “white revolution” with the abolition of the feudal regime and the nationalization of forests and pastures (the name was taken after the head of state explained in 12 articles the bases of a reform in the field I know economic and economic) distributed 8 million ha to 2.3 million families. Now 40% of the active population is employed in agriculture, which contributes 15% to the formation of the national income (1962: 26.6%). The increase in production, which is still limited, is due to the increase in the cultivated area rather than to a more intense use of fertilizers and agricultural machinery. The scarce availability of water, the bad transport system, the persistence of antiquated techniques counteracts the development of agriculture. According to Smber, in fact, the lack of qualified technical personnel and entrepreneurial spirit is felt, although in the less developed agricultural areas thousands of young graduates have carried out their work, acting as teachers and doctors. It is estimated that the cultivated area amounts to 19 million ha, equal to 11.5% of the total area, while the potentially arable area would be 18.8%. For the future there is a tendency to create government companies in which the complete processing cycle can take place. The land reform also had political repercussions by decreasing the power of the large owners.
Subsoil products. – Oil production increased to 192 million tons in 1970 and 294 million tons in 1973, 90% of which was extracted from the government-controlled National Iranian Oil CO.; among the smaller companies is Sirip, in which Agip is interested. The reserves (8.5 billion tons) are equal to 10% of the world total. New wells have been opened in Marun and Agha Jari, also in the Mesopotamian area, where the Iran it is still in conflict with the ‘Irāq for the control of the estuary of the Shatt el-Arab. Notable finds have been made in the Persian Gulf. Natural gas reserves are also enormous (2270 billion m 3, equal to 9% of the world total). In 1974, the extraction was 22.1 billion m 3(Italy: 15.3). Vast iron deposits (with 4.6 billion tonnes of reserves) are now being exploited in Bafgh (in the Kermānshāh region).
Routes and means of transport. – There has been an improvement in traffic conditions and a development of the means of transporting energy. The railway network increased to 4412 km (1970). Important was the opening (September 1971) of the connection of the network of the Iran with the Turkish one; the Iranian stretch, especially difficult between Lake Urmia and the border (with 126 bridges and 4 tunnels), is 130 km long; given the abundance of oil, the trains use diesel engines. Also worth mentioning is Bender Sha’s connection with Gurgan. Kermān is now connected with Isfahān. Also important is the construction (1967-70) of a 1106 km gas pipeline that crosses the Iran from south to north and from the fields E of Ahvāz it goes as far as Astara, near the border with the Soviet Union (buyer of significant quantities of Iranian methane); some branches connect the pipeline with Shirāz (305 km), Isfahān (374) and Teherān (305), where it is used both for heating and for industries. For the shipment of the exported oil, Khark (on the island of the same name) and Machur (near Bandar- and Shāhpūr) were added to the already existing ports. In September 1967 the negg port of Bandar ‛Abbās.
Industries. – So far the Iran it was equipped only with industries aimed at the production of consumer goods and food products. Profits from oil have given rise to new industries destined not only for the refining of crude oil, but also for the use of methane, which has given rise to the creation of petrochemical plants in Bandar-e Shāhpūr, Khark and Ābādān. A fertilizer factory has sprung up in Shirāz, where a refinery has been operating since 1975. But of greater significance is the creation (1967-71) of a steel plant in Riz-Lenjan near Isfahān (Aryamehr workshops), built on the initiative of the Soviet Union, which in exchange receives considerable quantities of methane. The plant has a production capacity of 4 million tons of steel; it uses iron ore from the Bafgh deposit (exploited since 1971) and coal from Zarand. An aluminum factory has been operating in Arak since 1973. Many other mechanical, textile, etc. industrial plants. they arose in the outskirts of Teherān, where 60% of the industrial workers are concentrated. The exploitation of hydroelectric energy is also progressing (dam on the Dez in Khūzistān in 1963).
Foreign trade. – The trade balance, given the presence of hydrocarbons, is active, so that the Iran, having strengthened its industries, now tends to differentiate its economy by exporting finished products to the countries of the Near East (which it seeks to incorporate in its orbit), as well as in developing countries. 88% of exports ($ 4.2 billion in 1973-74) consist of oil; followed by carpets, cotton, leathers, sweaters, footwear. In the same year, imports amounted to 3.4 billion dollars, with a prevalence of machinery and semi-finished products, of which 82.5% came from Western industrialized countries and 12.6% from Comecon countries. Italy participates in 4.4% of imports, mostly from Germany (18.4%), the United States (16.6%), Japan (14%), the United Kingdom (11.6%).
On the international level, Iran it exercises an active policy to emerge over neighboring countries and dominate the Persian Gulf and precisely for this reason military spending absorb a growing share of the national budget.