The Guardians Council has approved President Ahmadinejad's "Economic Reform Plan" intended to phase out billions of dollars in state subsidies that currently keeps the costs of food and energy low. Under the plan, prices of subsidized goods would be allowed to reach “normal market prices” over the next three to four years. The government has not announced the start date for the reforms.
The Majlis had approved the bill last week after a long and heated debate over its effects during a period of high inflation. The funding for government subsidies eats up 30 percent of the country’s annual budget.