Mar 2, 2018

Major Iranian urban centers have seen unprecedented air pollution in recent years. According to officials, it is caused primarily by the many cars on the streets, with heavy vehicles including trucks and buses emitting 63% of air-polluting particles. An estimated 350,000 dilapidated heavy vehicles, according to the traffic police, are particularly large producers of pollutants. These vehicles also consume more fuel than newer vehicles. Aging cars, meanwhile, consume 60% to 100% more fuel than new ones, according to Mohammad Mehdi Talaei, a member of the Car Scrapping Crafts Union.

Iran has long sought to rid its streets of these aged vehicles. At least 1,230,000 such vehicles — some have put the number at more than 2 million — were scrapped in the decade ending in the last Iranian year (March 2016-March 2017).

A plan was devised four years ago to replace old cars with new, mostly imported ones. But the process has ground nearly to a halt due to a lack of coordination among different bodies as well as troubles with financing. A ban on car imports imposed in the current Iranian year further slowed down the process. Although the ban was lifted Dec. 31, only 110,000 out of the 800,000 dilapidated cars planned for this year have been scrapped so far, with less than a month remaining.

The plan has not been abandoned. Earlier this month, the government announced a major project to scrap 202,500 dilapidated heavy vehicles and replace them with new ones, to be launched in the next Iranian year. It is projected to take three years to complete at a cost of $7 billion. There are plans to extend it later on to include cars and motorcycles.

Valiollah Seif, the head of the Central Bank of Iran — one of the parties to the project — has said that it will be equally funded through domestic and foreign exchange reserves. According to Seif, as far as domestic reserves are concerned, purchasers will pay a portion of the price and be granted loans to pay the rest. “As far as forex reserves are concerned, the Oil Ministry will pay expenses either through credit financing or through money generated by fuel conservation,” he said at a seminar on overhauling the Iranian transportation fleet in Tehran on Feb. 6.