Persian Empire 1845

Chapter 256 New Open Source

Inside the Ministry of Finance, Minister Abid Rahman was sighing, which made Minister of Industry and Commerce Rashid and Minister of Agriculture and Forestry Qasim, who had come to visit, feel that something was wrong.

"I think you all understand what Shah said at the meeting, right?"

"Of course, they say they want to build a better place. They also say the government needs to put in more effort."

Before he could finish speaking, Rahman immediately added, "That's the problem. Everything needs money for construction, but..."

Having said that, the two understood the situation. They didn't have enough money; that was indeed a bottleneck for Iran's progress.

According to estimates from the Ministry of Finance, Iran's fiscal revenue this year is 4532 million rials, a significant increase compared to previous years. This is mainly due to the development of industry and commerce, increased trade, and growth in sales of commodities such as sugar, tea, and wine.

However, spending is also growing rapidly, reaching 5031 million rials. Iran's fiscal deficit is as high as 500 million rials, which is being covered by issuing national debt.

But now, the country has gained so much new territory. Although the Ottomans promised reparations, if things were to proceed as the Shah suggested, the treasury would have to contribute at least 8000 million riyals. Not to mention the issue of African colonization.

“The country is facing difficulties right now, and so are all the departments. Take our department for example; Shah has asked us to plant trees all over the country, which is a considerable expense every year. Moreover, the country has very little arable land, and we will only see benefits once the Mesopotamian Plain is fully developed.”

Qassem explained the situation in their department, the agriculture and forestry department, which oversees primary industry. Iran's limited arable land and water resources are naturally the biggest obstacles to development. However, they are experimenting with tea and sugarcane cultivation in East Africa and are working hard to reclaim local land; it is estimated that it will take several more years.

However, one thing that happens quickly is that date production can be increased immediately. Exports will also help increase fiscal revenue.

Rashid then spoke up: "The recent development of industry and commerce has indeed been strong, but the increase in fiscal revenue cannot be achieved overnight. It is impossible to collect 10 riyals today and increase it to 1000 riyals tomorrow. If all else fails, I think we should raise taxes. Or cut costs from other places."

As for finances, it's either about increasing revenue or cutting spending. He's working on increasing revenue through taxes, planning to raise transaction taxes on stocks and increase tobacco taxes, and also exploring ways to make the colonies even more impoverished. As for cutting spending, he hasn't yet come up with any good solutions.

"Alright, thank you both for your suggestions, please return."

The two left the Ministry of Finance, leaving Rahman alone to figure out a solution. Just then, he received an invitation from the Grand Vizier to have lunch, and quickly packed his things to go.

When he arrived at the official residence, travel-worn, he found that representatives of the Iranian oil company were also there.

“Sir Amir, Mr. Rana.”

Amir nodded, and the three of them sat down at the table and began to talk about recent events.

"Grand Vizier has made a great contribution to this territorial expansion. I heard that the Shah is planning to promote you to the rank of Duke, which is an unprecedented honor."

Amir was a little embarrassed by what was said and simply waved his hand. "We're all working for the country. Since we're in this position, we have to serve the country." Serving the country made Rahman feel good. However, the shadow of financial hardship still loomed over him, and Amir noticed why Rahman was having a headache, so he explained to him.

"I know that there has been a lot of pressure on fiscal spending recently, and this is also a preparation for a new plan."

I think you two are aware of Shah's earlier statement about establishing a national investment company, right?

Upon hearing this, the two immediately said they remembered. However, it was later shelved for various reasons. Is Shah now preparing to pick it up again?

"Shah is preparing to promote the establishment of the company in order to provide more fiscal revenue for the country. Europe is now telling us that if we want to make more money, we have to invest abroad to give back to the country. But our private capital is too weak, so we can only rely on the state."

Rahman naturally wouldn't object to this profitable venture, and the oil company representatives couldn't object either, since they were state-owned enterprises and handing over profits to the state was mandatory.

"The government's plan is to combine the profits turned over by oil companies over the next two years with the funds contributed by the Ministry of Finance to form a foreign investment company. This company will be responsible for investing and generating profits around the world, but it can only use 40 percent of the profits each year. Misuse of these profits could lead to other problems."

Upon hearing that he could only use two-fifths of the profits, Rahman wanted more. However, considering that he would have to put in more money if he lost money, he suddenly felt it wasn't unacceptable.

This is also what Shah wanted to see: to improve investment performance through long-term management, seek long-term investment returns, thereby preserving and increasing the value of assets for future generations and contributing to market practices.

The Ministry of Finance naturally agreed to this seemingly advantageous suggestion. The company's name had already been decided: the Persian Investment Agency, which sounded somewhat like a government agency, and its funding would come from oil processing and export.

"Now, let us raise our glasses for the future of our nation!"

The three raised their wine glasses, wishing the nation prosperity and the Shah good health and longevity.

Now that Iran has entered the post-war governance phase, and knowing the difficulties faced by the Ministry of Finance, Nasser al-Din directed Banque de l'Indochine to transfer all of their gains in Japan to the Ministry of Finance.

During this period, Iranian merchants traded as much as 90 taels of Japanese gold. This was not only because government officials were involved, but also because some Japanese individuals were involved, profiting from their cooperation with Iran.

Don't assume that all Japanese people are the kind who adhere to the samurai code and are indomitable. They'll wag their tails and follow you blindly as long as you offer them some benefits; all you need to do is control their economic lifeline. With Britain and France neglecting this area, Iran naturally filled this gap, and even had a group of sycophantic Japanese compradors helping them with trade.

These people were also following the orders of the Iranians, receiving commissions and investments for completing tasks. Through prolonged contact, they also converted to Shia Islam, becoming people who had opened their eyes to the world.

However, they were not recognized by the so-called "Revere the Emperor, Expel the Barbarians" faction, and had suffered numerous assassination attempts because of this. Especially in Ryukyu, relations between Iran and the Satsuma Domain were on the verge of exploding, just a spark away from igniting a conflict.

This money is enough for Iran to do many things. Of course, the most important thing is that the Tehran-Baghdad railway is immediately on the agenda, and construction is needed in various parts of Mesopotamia. The centuries of Ottoman rule here have done absolutely nothing; vast tracts of fertile farmland have been abandoned. It simply won't do.

(End of this chapter)