Subsidy Removal Increasing Internal Political Risks

BMI View : We hold to our view that the planned removal of food and fuel subsidies, although necessary, will increase risks of political instability in Iran. Recently, the Supreme Audit Court expressed its concerns with respect to the increase in basic food prices that will follow subsidy reductions, which we believe also underlines the fact the government is under increasing pressure to alleviate the impact of the economic sanctions.

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