Although the government of Dr. Mosaddeq did its best to nationalize oil in 1950, presence of politicians who served foreign interests prevented establishment of machine manufacturing and other plants.

The trend continued until the past regime introduced its second economic development plan by spurring industrial growth and establishment of refineries, petrochemical industry, and other heavy industries in Iran.

Since 1974, when the Organization of Petroleum Exporting Countries (OPEC) managed to make basic changes to global oil prices, oil revenues of its members increased and this coincided with the fifth development plan of the former regime. Unfortunately, instead of using oil revenues to make basic investments, that is, to establish technology-intensive industries which would have reduced our dependence on other countries, the Iranian officials made a dire strategic mistake and instead of developing industries, focused on developing Chabahar port city, as well as development of military bases and defense capabilities. In fact, instead of helping the country to realize its national goals, oil revenues were used by the monarchial regime to bolster its defense capabilities. Therefore, they decided to enhance Iran’s military presence in the Indian Ocean and established the biggest marine and submarine facilities in Chabahar.

Presence of the Iranian forces in Lebanon and Somalia showed that instead of pursuing industrial and technological objectives, that regime was moving to develop its defense abilities, thus, conditions for industrial development and independence from other countries’ downstream oil industries were not provided.

After the victory of the 1979 Islamic Revolution, due to lack of experience among revolutionary officials and the beginning of the Iraqi war, the Iranian oil industry was faced with many problems. On the other hand, the country was facing limitations for oil exports and for 8-9 years, the industry underwent unfavorable conditions.

After that during implementation of the first through the fourth economic development plans, oil revenues served to increase dependence of the national economy on petrodollars instead of spurring growth of infrastructural sectors. Unfortunately, oil revenues cover more than 60 percent of the government’s current expenditure.

The Fourth Economic Development Plan projected total oil revenues to hit 92 billion dollars. However, Iran’s revenues during the first 1.5 years exceeded that figure. However, neither the Fourth Economic Development Plan is amended, nor good ground has been provided for basic investments. Although dozens of petrochemical projects have been, thus far, implemented, we still import the needed technology from Western countries.

A glance at the industrialization trend of South Korea would reveal that a country, which imports oil, is currently one of the biggest producers of petrochemicals through establishing two petrochemical plants and is even investing in Iran’s petrochemical sector.

Despite high oil revenues, the government is importing more consumer goods instead of developing industrial sectors. In practice, instead of providing good grounds for development of software engineering in our country, the oil industry has been useful for establishing hardware facilities. We used petrodollars to build a plant like Azarab, but we are still dependent on other countries for technology.

Perhaps some may note that United Arab Emirates is also living on petrodollars, but a comparison between Iran and the UAE will reveal that Iran is the biggest country in the Middle East in terms of population. Therefore, since industries are needed to depict a promising future picture of the country, we should have used oil revenues for other purposes than covering government’s current expenses. Using oil revenues, we have increased government’s control over the economy rather than increasing industrial capacities of the country.

At present, 80 percent of our economy is run by the state and this is because oil revenues have not been used to plan an industrial economy, but have boosted a state-run economic system.

For example, Turkey is weak in terms of hardware and has no oil revenues, but its industrial exports have been valued at more than 50 billion dollars.

Despite our oil revenues and industrial capacities, our industrial exports do not exceed 5-6 billion dollars a year because our industries have been mostly developed in hardware terms. Since they are based on state-controlled resources which are used to boost government’s power, in practice, our abilities in the oil sector are limited to exploiting and maintaining oil wells. We should have been an independent country in terms of technology by now, but we are still dependent on Western technology. This is even true about industries which are involved in producing oil derivatives. That is, we do not have even one refinery whose all parts have been manufactured in the country independent of imported technology.

As a result, although the oil industry can spur industrial growth of the country, due to lack of organized planning and a national currency, those resources cannot be used to achieve industrial independence, at least, in oil and petrochemical sectors.