A banking syndicate is being created with the specific goal of financing the biggest water transfer project in the country that will take water from the Persian Gulf to the provinces of Hormozgan, Kerman and Yazd, says the head of the Majlis Economic Commission.
"One of the major issues that must be considered today is providing water resources with the aim of boosting economic development because the implementation of projects has hit roadblocks due to shortage of water resources," Mohammadreza Pour-Ebrahimi told ICANA, the official news portal of the parliament.
According to the senior lawmaker, the project based on which water resources will be taken from the Persian Gulf and transferred to support industries and projects in the southern and central provinces will be able to make a big contribution to economic development.
"According to estimates, 60 trillion rials ($1.43 billion) worth of credit should be made available for the implementation of this water transfer project," he said.
A number of bank chief executives have come to the parliamentary commission to discuss the matter of financing the water project, after which the decision to create the banking syndicate was taken.
Bank Melli Iran –the nation's biggest lender– Bank Sepah, Bank Keshavarzi (Agriculture Bank), Bank of Industry and Mine, Bank Mellat, Bank Refah, Bank Saderat, Bank Tejarat and the Bank of Industry and Mine are members of the syndicate.
"It has been decreed that each of the aforementioned banks will allocate 20% of their share of the water project in foreign currency while 80% of the shares will be in rials," Pour-Ebrahimi concluded.
Iran's worsening water crisis and the arid conditions in the southern and central provinces has made water development a major priority in official plans. Water transfer projects, however, have not remained without controversy due to their huge costs and protests by local residents.
According to data, some 88.9% of the country's water usage goes for agriculture, 8.3 % for drinking and 2.8 % is consumed by industries.
According to the Majlis Research Center, the biggest challenges facing Iran's water sector include climate change, reduction in renewable sources, demolition of water ecosystems, low productivity in water usage plus domestic and regional water disputes.