Crackdown On Online Businesses Intensifies In Iran
Amid the Nowruz shopping season on the eve of Iranian new year, the Prosecutor's Office and Cyber Police in Iran have ramped up enforcement on online businesses.
Amid the Nowruz shopping season on the eve of Iranian new year, the Prosecutor's Office and Cyber Police in Iran have ramped up enforcement on online businesses.
Alongside the suspension of vehicles and the closure of establishments, authorities have now intensified scrutiny on ecommerce, citing concerns over "improper hijab" during the shopping period.
They have targeted images on websites and social media deemed to violate strict compulsory hijab regulations. The crackdown has affected numerous bloggers and businesses in the women's clothing sector, leading to page suspensions and post deletions, according to Didban Iran.
One women's clothing vendor, conducting both offline and online sales, spoke of being compelled to remove images following guidelines mandating closed coats and jackets, prohibiting street-location product photography, and banning the use of mini scarves. Any exposure of body parts and the use of distressed jeans is also strictly prohibited.
Reza Olfat Nasab, a member of the Union of Virtual Businesses' board of directors, said that “image regulations are just one of many concerns". She explained, "Larger issues such as internet speed and restrictions pose significant hurdles to the industry's operations.”
The increased enforcement of hijab comes in the wake of extensive protests in Iran following the death of Iranian Kurdish woman Mahsa Amini in 2022 while in morality police custody. Amini's arrest in Tehran, reportedly for violating the Islamic republic’s compulsory hijab requirement, sparked one of the largest uprisings since the regime came to power.
Women nationwide have been actively contesting the mandatory hijab, leading to heightened vigilance from hijab enforcement personnel in public areas like subway stations, schools and universities and public spaces.
The Coordination Council of Teachers Associations in Iran has issued a condemnation of the ongoing wave of executions in the country, at record highs since the founding of the Islamic Republic.
In a statement, the council emphasized that despite the continued use of capital punishment, the government has failed to suppress the people of Iran who have been in the midst of the biggest anti-government unrest since the regime came to power.
"The act of execution is an inhumane, irrational, unethical practice and is the product of the will of the ruling minority, and until today, the punishment of execution has failed to subdue the people of Iran," the association statement said.
The condemnation follows Monday's outcry by over 430 civil and political activists within Iran, who criticized the execution spree, citing contradictions with the country's legal system.
The executions of four Kurdish prisoners—Pejman Fatehi, Mohsen Mazloum, Mohammad (Hazhir) Faramarzi, and Vafa Azarbar— at Ghezel Hesar Prison in Karaj, near Tehran, in late January ignited significant outrage. The men were accused of plotting to blow up a defense ministry facility in Najafabad in July 2022, as well as being labeled Israeli agents. Their executions particularly incensed many Iranians, leading to a general strike in Kurdish areas of the country.
Furthermore, the recent executions of Mohammad Ghobadlou, a protester from the 2022 demonstrations, and Farhad Salimi, a Kurdish political prisoner accused of murder, have drawn widespread condemnation from both domestic and international human rights organizations.
The surge in executions in Iran is notable, with 90 executions reported between December 22 and January 21 alone. According to UN experts' reports, Iran executed at least 834 Iranians in 2023, with eight of them reportedly linked to nationwide protests.
With Iran’s national currency on a rollercoaster, the government has given the green light to state banks for a whopping 30-percent interest rate for special fixed-term deposits.
Last week, the Central Banks of Iran announced the issuance of special certificates of deposit with an annual profit rate of 30 percent (paid monthly), a measure aimed at incentivizing people to keep their capital in banks instead of exchanging them to other currencies and keep them at home. In February 2023, Iran had raised the interest rates from about 15 percent to about 22.5 percent exactly to prop up the rial, a move that failed to strengthen the national currency. The rial fell from 400,000 per dollar in January 2023 to 500,000 by May.
According to Ehsan Khandouzi, Iran’s Minister of Economic Affairs and Finance, the Central Bank has authorized the issuance of this specific type of deposit bond with a total value of 2.8 quadrillion rials, or about$5.6 billion.
Although the timespan was announced to be only a week, some banks refused to offer the service in the early days due to several opaque issues not addressed in the central bank’s directive, such as details about the break cost and the taxation on the profit, according to Iran's leading economic newspaper Donyaye Eghtesad (World of Economy). However, according to Fararu website, about 98 percent of the total amount of bonds were sold by Monday, the fourth day of the implementation of the plan.
The rial was on a nosedive last week after an attack on a US base by Iran-backed militia in Jordan killed three US service members and injured more than 40 others. The looming shadow of a war involving Iran led to an extraordinary rise in exchange rates, bringing the price of every US dollar close to 600,000 Iranian rials. However, the rial bounced back regaining around 50 percent of the lost ground following what was perceived as limited US retaliatory strikes against a series of Iran-linked targets in Iraq and Syria, with the danger of a direct attack on Iran receding.
According to Etemad newspaper, the purpose of raising interest rates is to encourage the flow of funds in the Iranian market and preventing the conversion of rial deposits into foreign currency. Proponents of the decision argue that the financial tool was used by Russia’s central bank and was successful in managing the psychological impact of the war in Ukraine on the Russian ruble. Opponents argue that such a high interest rate will make the Iranian stock exchange market redundant as people may remove their funds and deposit it in the banks.
Nour News, a media outlet linked to Iran's Supreme Council of National Security, said that given the country’s soaring inflation rate, the decision to increase interest rates aimed at encouraging people from converting foreign currencies into rials "and control the currency markets was inevitable.”
Economist Ghodratollah Emamverdi argued that the government seeks to attract financial resources towards the banking system, essentially implementing a form of monetary contraction policy. Referring to the timing of the measure that coincided with intense ups and downs in the value of the rial, he said the devaluation "has a direct correlation with military and political insecurities in the region and the emerging threats, lack of political interactions between Iran and its neighbors and the entire world, especially with the United States.”
But the question is, how the government intends to pay the high interest to investors. Most believe that the only mechanism the central bank has is to print money.
Emamverdi believes that the government does not expect the rial to regain its value, claiming that “Money creation in the banking system has become endogenous, and, in fact, the banking system creates money out of thin air.”
Financial consultant Habil Khavari told ILNA that the especial bonds were issued to funnel people’s stray funds wandering between gold and foreign currencies, noting that the government resorts to such measures near the end of each year to make up for its budget deficit. The Iranian year ends on March 20. But this year, the total amount involved and the higher interest rate are notable.
As the special bonds were selling like hot cakes in the volatile Iranian market, the government may now have enough reason to extend the plan or allocate additional funds for it. Donyaye Eghtesad said on Monday that, considering the unexpected yet significantly positive feedback to the measure -- which led many banks to quickly reach their limits -- the Central Bank is expected to respond to the popular demand with an announcement in the coming days.
According to Iran's Foreign Investment Organization, Russia funded the regime with $2.7bn under the Ebrahim Raisi administration.
The head of the FIO, Ali Fekri, disclosed the figures on Monday, stating that the majority of direct investment from abroad came from Russia, the UAE, China, Turkey, Iraq, India and Oman.
“Over the course of the Raisi administration until December, a total of $10.6 billion in capital entered Iran, with Russia accounting for approximately $2.7 billion of the amount. The oil and gas sector saw the highest capital attraction, with five investments totaling around $4.8 billion," he said.
Comparing foreign investments, Turkey received $4.8 billion in foreign direct investments only in the first half of 2023.
Saudi Arabia is aiming to attract $3 trillion in foreign investment by 2030, to improve economic development, technology transfer, job creation, and boosting non-oil exports.
Unlike Turkey and Saudi Arabia, where foreign investments play a significant role in driving economic growth and infrastructure development, Iran faces challenges in tapping into its potential as an attractive destination for foreign capital.
The militant activities of its proxies abroad, economic sanctions, human rights abuses at home and regulatory uncertainties continue to hinder Iran's potential to attract investment.
Several journalists from Iran's liberal-leaning Fardaye Eghtesad newspaper were arrested on Monday amid further state crackdowns on the media.
According to the few journalists who have since been released, their possessions such as mobile phones have been confiscated but details of the charges and the entity involved in the arrests have not been announced. Six people, including senior editors, are still being held in the building. Officials also conducted an extensive investigation at the office of Fardaye Eghtesad website.
Mizan, the official news agency of the judiciary of the Islamic Republic, issued a statement Tuesday, explaining that their investigations show that the security raid to the office of the newspaper and the arrest of an economic journalist had no connection to journalistic or media activities. The judiciary said that the case is being followed by another security authority in the country, which is mainly theintelligence apparatus in such cases.
Etemad Online reported on Tuesday that journalist Mehdi Afsharnik, whose arrest was also announced Monday, was detained on Wednesday, January 31, while the reason and the entity behind his detention are still not clear.
Criticism has emerged regarding the lack of transparency from official authorities, with no clear explanation provided for nearly 20 hours following the incident. Some journalists have described the action as tantamount to “hostage-taking.”
In Iran, journalists have been under pressure for years and are detained, imprisoned, and banned from work under various pretexts.
Last year's Freedom House report on global freedoms ranked Iran 12th in the 100 least free countries in the world.
In the 12 months following the Women, Life, Freedom uprising of 22, at least 79 journalists had been arrested, with the trend continuing, according to rights group Reporters Without Borders.
Armed groups backed by Iran have carried out at least two strikes on American forces since Friday, when the United States hit dozens of Iran-related targets in Syria and Iraq.
Pentagon spokesperson Maj. Gen. Patrick Ryder confirmed in a press briefing Monday that two attacks had taken place in Syria and that there had been no casualties. He also suggested that the Pentagon expects Iran's proxy groups to continue their targeting of American forces in spite of the February 3rd US airstrikes.
In the meantime, Yemen's Iran-aligned Houthis said on Tuesday they fired naval missiles at two ships, Star Nasia and Morning Tide, in the Red Sea.
The group's military spokesman Yahya Sarea said in a televised speech that they were US and British ships, but records from shipping trackers show they are flagged to the Marshall Islands and Barbados.
The US air campaign against targets in Syria and Iraq was authorized in response to the drone attack on January 28 that resulted in the deaths of three American soldiers and injuries to 40 others at a US base in Jordan. President Joe Biden and his team heavily publicized it both domestically, as evidence of their resolve, and internationally, as a deterrent against such attacks. As things stand, it is hard to say if the administration achieved these two goals.
At home, pressure is still mounting. Biden critics are by no means satisfied with his shot at ‘retaliation’. They accuse him of giving Iran’s Revolutionary Guards (IRGC) enough time and clues to disperse and avoid a bloodied nose. And abroad, the message from Iran is clear: we had no presence or interest in the sites targeted –if we had, we would have hit back.
Ryder confirmed in his briefing that no Iranians were killed in the US airstrikes in Iraq and Syria in the early hours of Saturday local time. “CENTCOM is continuing to assess but initial indications are: we’re not aware of any Iranians killed,” he said.
What irked the critics was Maj. Gen. Ryder's remark that the administration doesn’t want a long-term campaign against Iran's military and associated proxy groups in Iraq and Syria. This apparently contradicts statements in the past ten days that the US is not done with those groups and will continue to target them.
“Our goal is not to… go full-scale war against Iranian proxy groups in Iraq and Syria,” Ryder said. “That’s not what we’re there for. We’re there to conduct the mission and support the defeat of [the Islamic State].”
Critics of the Biden administration say that such messaging is counterproductive as it signals “weakness”, which emboldens Iran and its proxies to be more adventurous, ultimately forcing the US to target IRGC or other regime assets directly, which, ironically, is what President Biden seems determined to avoid at all costs.
“I think you need a decisive strike, just like Trump did with Soleimani,” the House Foreign Affairs Committee Chair Michael McCaul told Fox News Monday. “They took Soleimani out and guess what, Iran backed down.”
Rep. McCaul also said that the retaliatory strikes last Friday were not satisfactory, contrary to what Ryder said in his briefing. “The targets may have been good,” McCaul said, “but the success was not.”
Officials from the Biden administration have repeatedly said that the airstrikes on IRGC-affiliated targets in Iraq and Syria were just the beginning, and that there’s more to come. But there seems to be a growing concern in Washington that even a string of attacks would fail to deter Iran –unless it hits “what matters to the Ayatollah.”
A Wall Street Journal editorial Tuesday drew a bleak picture, taking into account Iran’s nuclear ambitions.
“President Biden’s retaliatory strikes in Iraq and Syria on the weekend were targeted to avoid hitting Iranians to avoid escalation,” the WSJ editorial reads,. “Imagine the restraints on the U.S. when Iran has nuclear weapons and the missiles to deliver them against U.S. allies or the U.S. homeland.”
