In the past five years there has been a wave of foreigninvestment and many infrastructure projects - including hundreds of miles of roads and improved electricity supply - are either completed or on the way.
Since September, the government has taken several measures such as reducing fuel subsidies, easing foreigninvestment restrictions and fast-tracking industrial projects to improve economic conditions.
This, together with restrictive labour regulations, means that there is little non-oil foreign direct investment in Iran, except for pilot projects in the free-trade zones.
The fact that supported by the Russian government fund will investment in projects inside Russia in cooperation with foreign companies has created a major impulse for the market players who were not sure whether to invest in Russia.
Red tape from municipal and provincial governments gums up foreigninvestment, and the reduction in loans to cement and steel companies cuts all investment--including money for efficiency projects--to those industries.
The deal was struck under a currently discontinued program of the Dutch Ministry of Foreign Affairs, called ORET, which supported sustainable investment in infrastructural projects in developing countries.
Prime Minister Manmohan Singh's government had been hoping to push through legislations on easing foreign-investment rules in the insurance and pensions sectors and acquiring land for industrial and infrastructure projects in the budget session.