The Iranian Expediency Council has okayed the creation of a free trade and industrial zone in Incheh-Borun in Golestan province on the border with Turkmenistan, Iranian media reported. Incheh-Boron is one of the key points along the Kazakhstan-Turkmenistan-Iran rail corridor (north-south).
Hadi Haghshenas, the governor of Golestan, confirmed the news and said that the Incheh-Borun free zone covers an area of about 12,000 hectares and stretches for 40 km from the Incheh-Borun border to the industrial town of Etrek in the Etrek special economic zone.
Iranian legislators hailed the decision on Incheh-Borun’s new status. The Iranian Consultative Assembly decided to announce a free trade zone in Incheh-Borun back in 2019. However, the Guardian Council found the bill contradictory with the legislation. As a result, the controversial bill was submitted to the Expediency Council in accordance with the existing procedure for resolving the situation.
Ramadan Ali Sangdowini, representative from Gorgan province, believes that the availability of railways, ports, a 1,000-hectare industrial town, customs infrastructure, highways, as well as the presence of various ethnic groups in this region, distinguishes it from other free zones in the country.
“The north-south corridor of the Incheh-Borun free zone is the only route that connects Iran to Eurasia, Central Asia and China,” he said.
The Energy Commission of the Iranian parliament notes that trade with such countries as China, Kazakhstan, and Turkmenistan can cause positive transformations in the Iranian economy, since China is one of the largest economies in the world, Kazakhstan is a significant grain exporter, and Turkmenistan has rich oil and gas resources.
In addition, as the lawmakers highlighted, most of the existing free zones failed to cope with their tasks and turned rather into the places of commodity import. Incheh-Borun in the future can become a center for processing and production of new products, where various industries would be formed. Unlike other FEZs, Incheh-Borun will be featured with a dry port, a grain storage facility and other terminals.
The supreme advisory body under Ayatollah Ali Khamenei, or the Expediency Council of Iran, announced the creation of free trade and industrial zones in several more provinces – Mehran in Ilam province, Ardabil in Ardabil province, Sistan in Sistan and Baluchestan province, Bane Marivan in Kurdistan Province, Bushehr in Bushehr province and Gasr-e Shirin in Kermanshah province.
The legislation of Iran provides for tax benefits, export, import and commercial profit tax benefits in SEZs and STZ-SEZs (special trade zones, special economic zones).
Meanwhile, the law regulating the status of free trade and economic zones is still to be approved by the Islamic Consultative Assembly. The Expediency Council expects it may be adopted in the next two or three months.
In the face of uncertainty over the lifting of US sanctions on the Iranian oil sector, the country sets great store on FEZ projects, seeing them as economic boosters, a source of investments and new jobs in challenging times. /// nCa, 7 May 2021