Iran moves to boost Armed Forces with expanded defense budget

By Al Mayadeen English
Source: News Websites
7 Sep 2025 22:53

Iran’s Parliament is moving to increase funding for the Iranian Armed Forces, with a plan backed by MP Ebrahim Rezaei to boost defense spending, air defense systems, and procurement of foreign-made military equipment.

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Missiles are displayed by the Iranian Revolution's Guard during an annual armed forces parade marking the anniversary of the beginning of the war against Iran by former Iraqi Dictator Saddam Hussein 44 years ago, in front of the shrine of the late revolutionary founder Ayatollah Khomeini, just outside Tehran, Iran, Saturday, Sept. 21, 2024 (AP Photo/Vahid Salemi)

The Iranian Parliament’s National Security and Foreign Policy Commission has endorsed a wide-reaching proposal to increase defense spending and bolster the capabilities of the Iranian Armed Forces, commission spokesman Ebrahim Rezaei announced to local Iranian media on Sunday, September 7.

The draft legislation, initially formulated during the 12-day Iran-Israeli war in June, has been reviewed in coordination with several state bodies and is expected to be discussed in upcoming public sessions of the Iranian Parliament.

According to Rezaei, the plan mandates the Planning and Budget Organization and the Oil Ministry to fully allocate the defense budget for 2025, while also covering outstanding funds from 2024.

Additional provisions require the Planning and Budget Organization to ensure that defense-related allocations from the Supreme National Security Council are met, either through savings or oil revenues.

The proposal includes a directive for the Central Bank of Iran to provide up to €2 billion in zero-interest loans from blocked or other foreign currency reserves to the General Staff of the Armed Forces for urgent defense projects.

A further €2 billion will be made available for the Defense Ministry to purchase key defense items from abroad, coordinated with the General Staff, Rezaei said.

In addition, $1.5 billion worth of oil may be allocated to the Armed Forces to support critical defense needs, while 30% of all revenues generated from Iranian airspace transit fees will go toward upgrading the country's air defense systems.

Iran responds to June war with "Israel"

Rezaei emphasized that the proposal was a direct response to the recent conflict with "Israel" and aims to address gaps in the Iranian military’s readiness.

“With the adoption of this plan, we expect concerns over strengthening the country’s defense power to be alleviated, and a fundamental transformation to take place in the Armed Forces’ equipment, capabilities, and even livelihood,” he said.

The move comes amid heightened regional tensions and marks a significant effort by Iran to modernize its military structure and counter potential aggression from adversaries.