Dec 7 (Reuters) – Iranian President Hassan Rouhani will hike military spending by more than a third in the next fiscal year despite presenting a “cautious, tight” budget to parliament on Sunday in response to falling oil prices and punishing sanctions arising from the country’s disputed nuclear programme.
Rouhani proposed a general budget of 8,400 trillion rials ($312.13 billion at the official exchange rate) for the Iranian fiscal year starting March 20, 2015. This includes the entire the sprawling public sector.
A smaller government budget, part of the larger general budget, was set at 2,200 trillion rials.
These are based on an oil price of $70, as opposed to $100 this year, Rouhani said. Oil has fallen some 40 percent since June to under $70 on Friday.
“The budget is drafted with a cautious eye to the oil prices,” Rouhani said in a speech to parliament broadcast live on state television. “The current situation demands a more subtle and realistic approach to (the) budget draft”…