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A recent report by the Research Center of the Iranian regime’s parliament has exposed the alarming deterioration of Iran’s National Development Fund (NDF), an institution originally established as a safeguard for the country’s future economic stability. Once heralded as “the engine of sustainable development” and a vital mechanism for financing macroeconomic projects through private sector lending, the Fund has now become a hollow entity—stripped of function, oversight, and purpose.
No Oil Revenue Transfers Since 2023
According to the parliamentary report, not a single dollar of the NDF’s legal share of oil revenues has been deposited into its account since the beginning of 2023. While Iranian law mandates that a portion of revenues from oil, gas, gas condensate, and petroleum product exports must be transferred directly to the Fund, in reality, all such proceeds are routed through the Central Bank and merely recorded on paper. As a result, the Fund holds no actual liquid assets and plays virtually no role in financing development initiatives or driving economic resilience.
Iran’s regime taps into the National Development Fund in fear of imminent uprisings https://t.co/bT6Ax7M1Jf
— People's Mojahedin Organization of Iran (PMOI/MEK) (@Mojahedineng) September 8, 2024
A National Wealth Fund Drained
Established to preserve a portion of the country’s oil wealth for future generations, the National Development Fund was designed to operate like a sovereign wealth fund. It was intended to promote intergenerational equity by investing oil revenues in long-term, productive ventures.
However, of the more than $155.6 billion that should have legally been transferred to the NDF since its inception, much of it was never deposited—or was siphoned off under the guise of “government borrowing,” often without any formal documentation of debt. This means the regime has systematically eroded a fund that was meant to serve as a fiscal buffer and development catalyst, replacing its long-term mission with short-term political expediency.
Structural Abuse and Budget Support
The report details how the Central Bank, under pressure from the regime to stabilize the currency and cover budget shortfalls, has repeatedly tapped into the NDF’s reserves, using them to plug fiscal gaps rather than investing them in long-term national development. The nominal growth in the Fund’s balance, according to the report, is largely fictitious—reflected only in accounting statements rather than in actual assets.
A Nation on the Brink: #Iran’s Economy Nears Total Breakdownhttps://t.co/vGWSKMuzub
— NCRI-FAC (@iran_policy) June 9, 2025
In practice, the Fund has become a tool for the regime’s short-term foreign exchange manipulation, undermining its credibility and core mission. This misuse not only reduces the Fund’s effectiveness but further entrenches the regime’s economic mismanagement.
A Record of Defaults and Mismanagement
A breakdown of the Fund’s performance offers a stark warning. By the end of December 2023, $132 billion of its resources had been spent, with roughly $85 billion allocated directly to government financing—contradicting the Fund’s intended role of supporting non-governmental and private sectors. Only $37 billion reached the private and public non-governmental sectors.
Repayment of loans paints an even bleaker picture. Of the $36.5 billion in loans granted, only $8 billion has been repaid, meaning that nearly 68 percent of loans are in default. By contrast, global default rates for sovereign wealth funds average around 6 percent. This high rate of delinquency reflects deep failures in the Fund’s credit assessment, lending practices, and oversight mechanisms.
Adding to these concerns, the Fund’s investment return rate is reported to be under 1 percent annually, signaling a near-total absence of professional asset management, strategic vision, or long-term financial planning.
Is #Iran's Economy on the Brink of Collapse?https://t.co/yf6CwE91JC
— NCRI-FAC (@iran_policy) June 5, 2025
From a Strategic Asset to a Hollow Shell
The report concludes in dire terms, warning that the National Development Fund is no longer an economic stabilizer or a force for sustainable investment. Instead, it has been reduced to an inefficient, non-operational, and visionless institution, incapable of fulfilling its legal mandate or protecting the country’s national wealth.
Independent economic observers have echoed similar concerns. The state-run economic outlet Eco Iran previously reported that nearly 63 percent of the NDF’s resources had been withdrawn under the false pretense of supporting the non-governmental sector, when in reality they were funneled into regime expenditures. This amounts to approximately $101 billion diverted from the Fund, further eroding its credibility and capacity.
#Iran’s Economy in Freefall: Parliament and State Officials Acknowledge Crisis Across Key Sectorshttps://t.co/zl8xrLcbGL
— NCRI-FAC (@iran_policy) April 19, 2025
In yet another blow, Ali Khamenei, the regime’s supreme leader, authorized the withdrawal of an additional $10 billion from the Fund in 2025 to cover a deepening budget deficit—again prioritizing immediate regime survival over the country’s long-term prosperity.
Why the National Development Fund Matters
Sovereign wealth funds like the NDF are designed to preserve a nation’s natural resource wealth and convert it into productive, long-lasting capital for future generations. For resource-rich countries, these funds are crucial in managing volatility in commodity markets, cushioning against external shocks, and financing infrastructure, education, and innovation.
In Iran’s case, the plundering of the National Development Fund undermines the very prospect of intergenerational equity, meaning that the country’s youth and future citizens will inherit depleted resources, hollowed-out institutions, and a broken economic model. While the mullahs’ corrupt rule remains in place, Iran risks a future of prolonged economic stagnation, rising inequality, and deepening dependence on extractive, short-term policies that benefit only the regime’s ruling elite.