ABSTRACT
This chapter looks at industrial growth rates and the government's industrial development plans. In general, industrialization did proceed rapidly, encouraged by the regime's determination to build an economic foundation for Iran's growing military power. The industrial sector experienced a period of growth in the late 1950s, but it was largely limited to traditional industries. The statistics show that the highest growth rate in industrial value added occurred at the time of the highest growth rate in military spending. Military spending was relatively low in comparison to development spending, although it was toward the end of the plan that military spending began its rapid growth. The Military Industries Organization was the largest single purchaser of machine tools, exceeding even the State Industrial Development and Reconstruction Organization. Iran's import bills had been rising rapidly and military spending contributed to that increase.
