Hossein Heydar: Government-Private Sector Interaction Has Increased, But…
Hossein Heydar, CEO of Technolife, describes the first year of the 14th government’s term in the digital economy as a challenging period full of untapped potential. Despite the government’s emphasis on the importance of the digital economy and initiatives like expanding e-government services and engaging with private sector stakeholders, he believes the pace of policy implementation has not kept up with the rapid global developments, resulting in no tangible short-term benefits for the private sector.
According to the Tehran E-Commerce Association’s public relations office, Heydar evaluated the government’s performance by saying: In the first year of Mr. Pezeshkian’s administration, the digital economy remained one of the country’s most challenging yet promising sectors. Although its importance was recognized and steps were taken—such as expanding e-government services, improving coordination among agencies, and holding expert meetings with stakeholders—the speed of policy execution was not aligned with the fast-moving developments in the field. As a result, the private sector did not see significant immediate impacts from these measures.
He added that one of last year’s most significant weaknesses was the lack of a stable roadmap and clear strategy for the digital economy. Ad hoc decisions created uncertainty for businesses and increased operational risks for digital economy players. Internet restrictions and limitations on international platforms persisted, hampering the growth of startups and larger companies alike. Consequently, while free access to tools and markets fuels digital economy growth worldwide, Iran remains deprived of this advantage.
Fiber Optics and 5G: Slow and Incomplete Projects
Heydar emphasized that venture capital investment was stagnant, and emerging sectors like fintech, cryptocurrency, and artificial intelligence lacked clear and supportive legal frameworks. Internet quality and stability remained poor, with key infrastructure projects such as fiber optics and 5G progressing slowly. Despite global advancements in AI and e-commerce creating a unique opportunity for the country, no serious national initiatives were undertaken to seize these opportunities.
Regarding regulation, he noted that policies were generally restrictive. Central bank interventions, particularly in fintech and online markets such as gold trading platforms, undermined user trust. E-commerce platforms faced regulatory hurdles, while traditional businesses enjoyed greater freedom. This discrimination effectively ignored the digital market’s potential and reduced fair competition.
Foundational Needs Remain Unmet
Heydar highlighted that despite valuable potential, no substantial progress was made in addressing the fundamental needs of the digital economy, which include seven key areas: communication and technology infrastructure, clear legal and regulatory frameworks, financial and payment infrastructures, investment and financing, skilled workforce development, public trust and cultural awareness, and international cooperation and regional integration.
Nonetheless, many digital businesses have continued operating and played important roles in increasing economic transparency. Overall, although digital economy’s position was acknowledged in Mr. Pezeshkian’s first year, the absence of a clear roadmap, structural constraints, and weak governmental coordination prevented meeting sector expectations. The future of Iran’s digital economy demands transparent policies, practical support, and a more open view toward global and regional opportunities.
Major Achievements and Government-Private Sector Dialogue
When asked about the government’s most important achievements in the digital economy, Heydar said the period cannot be considered without accomplishments; some initial and limited steps could serve as foundations for future transformations.
He noted the elevation of the digital economy’s status in macroeconomic policymaking—a topic once marginal that became a central focus last year. Inclusion of digital asset provisions in the Seventh Development Plan illustrates a shift in governmental perspective. This can boost public confidence and enable the use of digital assets in financing and capital markets.
Heydar also mentioned expanded dialogue with the private sector, including more frequent meetings between the government and digital economy stakeholders. While concrete results remain limited, this approach can lay the groundwork for cooperation and mutual trust.
Other government steps he cited include “starting infrastructural initiatives,” “relative improvements in tax transparency,” and “raising awareness of global developments.” These are preliminary but essential steps that, if followed by clear policies, practical support, and continuity, could lead to more significant achievements in the coming years.
Persistent Weaknesses and Challenges
Heydar pointed out the lack of a comprehensive and sustainable strategy as the government’s gravest shortcoming. Fragmented and sometimes contradictory decisions made the business environment unpredictable, discouraging new investments and undermining goals such as raising the digital economy’s GDP share to 10% as envisioned in the Seventh Development Plan.
He also emphasized that ongoing filtering, restrictions on free internet access, and bans on global cryptocurrencies curtailed user and business freedoms. These policies resulted in missed international cooperation opportunities, weakened innovation, and reduced public trust.
Heydar highlighted continued ambiguity in digital economy taxation and regulation, which deters both domestic and foreign investment and hampers sustainable growth. He also criticized poor communication infrastructure, noting slow progress in projects like fiber optics and 5G. Despite having over 152 million active mobile connections, service distribution remains highly unequal, particularly in underserved areas, leading to poor digital experiences. Deployment of 4G and 5G networks lags far behind regional standards.
A Call for a National Digital Economy Program
Regarding government responsiveness to private sector concerns, Heydar acknowledged greater interaction during the 14th government. Joint meetings with associations, unions, and online business representatives, along with specialized sessions and permits for private sector involvement in digital transformation projects, signal a new approach.
However, the main issue is that these dialogues rarely translated into actionable policies or regulatory reforms. Many business actors feel their voices are heard but have little real influence on decisions. In practice, these talks remain mostly consultative and symbolic rather than impactful.
The government’s approach toward the private sector often focuses on taxation, experimental or restrictive regulations, and financial extraction, undermining trust. Slow fulfillment of commitments, absence of a clear roadmap, and legal and technical barriers continue to impede effective cooperation between government and private sector.
Heydar stressed that the future of Iran’s digital economy in the second half of the 14th government largely depends on broad policy directions and government decisions. A clear and sustainable strategy, reduction of existing constraints, and effective investment in communication and technology infrastructure can gradually improve conditions. Attention to emerging fields such as AI, fintech, and platform economies is vital to prevent further regional and global setbacks.
His Proposal for the Government
He proposed developing and implementing a “National Digital Economy Program” with genuine private sector participation. This program should facilitate imports and exports in e-commerce as a practical solution under current economic conditions, prioritize gradual internet liberalization and access to international platforms as prerequisites for sustainable growth, establish clear and stable tax and regulatory frameworks for predictable business environments, advance infrastructure development (including fiber optics and 5G) on a defined schedule, and create mechanisms to attract domestic and foreign investment in innovative and startup sectors.
Removing immediate obstacles like filtering and self-imposed restrictions on key apps and platforms should be prioritized.
Heydar concluded that such a program could end fragmented and inconsistent policymaking, restore trust, predictability, and investment motivation in Iran’s digital ecosystem, and enable the digital economy to become a major driver of national economic growth.