Iranian businesses incur billions in losses amid state-imposed internet blockade

Erbil, Kurdistan Region - Iranian businesses are losing billions of dollars due to the government’s continued restrictions on internet access, an official from Iran’s Chamber of Commerce warned, as the country’s shutdown becomes the longest nationwide blackout ever recorded.

“The direct damage from the internet shutdown is estimated at $30 - 40 million per day,” said Afshin Kolahi, head of the Knowledge-Based Commission at the Iran Chamber of Commerce, in a Sunday post on X, adding that indirect losses could be even higher, reaching around $80 million daily.

Kolahi’s remarks drew swift backlash online, with some Iranian social media users accusing him of assisting the enemy by advocating for restoring internet access.

Iranian authorities on February 28 initiated an internet blackout that has since remained in place, affecting the country’s population of over 93 million. The move coincided with a large-scale US-Israeli aerial campaign against Iran that targeted thousands of military sites as well as some civilian infrastructure, including petrochemical plants, railway bridges, and universities.

Tehran cited the US-Israeli operations to shut down internet access and restricting connectivity to its national intranet. The system, developed over the past 16 years, is closely monitored by intelligence services and is linked to the Islamic Revolutionary Guard Corps (IRGC).

Of note, the latter shutdown marked the third in less than 12 months, after a near-total blackout during the 12-day war with Israel in June and a 21-day disruption that overlapped with the nationwide pro-reform protests in January.

Repeated state-imposed internet restrictions have pushed many private-sector businesses into bankruptcy or to the brink of collapse, as Iranians already face severe economic pressure from government mismanagement, stringent international sanctions sanctions and high inflation, which stood at over 68 percent as of mid-February, according to the Statistical Centre of Iran (SCI).

Prominent Iranian businessman and economic strategist Pedram Soltani on Wednesday called on authorities to restore internet access, urging, “Get the internet up and running today,” and warning that “small businesses are falling apart.”

Meanwhile, Siamak Ghassemi, another renowned Iranian economist, warned on Monday that “although many people [in Iran] have been forced to temporarily migrate to domestic [intranet] platforms” due to the internet shutdown, “these platforms can never replace international internet access.”

Ghassemi warned that “the final breaths of many businesses are being counted, and widespread layoffs in service-based businesses have begun due to the internet shutdown.”

The economists’ remarks coincided with a Pakistan-brokered two-week ceasefire between the US and Iran that came into effect shortly before, paving the way for high-stakes talks in Islamabad. While the discussions ended without a final agreement, reports suggest that a second round may be held later this week.

Despite the truce, the internet blockade remains in place, with Iranian security and intelligence officials saying the restrictions are intended to prevent “the [US-Israeli] enemy” from exploiting wartime conditions to further infiltrate the country.

However, both the widespread impact of the internet shutdown, combined with the six-week war, appears to have paralyzed parts of the Iranian economy.
In a meeting held in Tehran on Sunday, heads of provincial chambers of commerce discussed the crisis.

Mohammad Irani, head of the Qom Chamber of Commerce, warned of severe cross-sector disruption, including damage to supply chains for packaging materials and petrochemicals, which he said would be difficult to restore. He added that conditions were unfavorable for both industry and agriculture and cautioned against hasty decisions without proper assessment.

In a similar vein, Mohammad Sadegh Hamidian, head of the Shiraz Chamber of Commerce, said Iran’s trading system is facing fundamental challenges, stressing, “We must act in a cohesive and unified manner and develop a strategy to transform the country’s economic governance.”

Hamidian added, “The private sector must take responsibility for shaping the economy.”

NetBlocks, a global internet access monitor, reported on Tuesday that Iran’s blackout had reached 46 days, marking the longest nationwide internet shutdown recorded in any country. The group warned that the disruption continues to damage livelihoods, forcing Iranians to take risks simply to communicate with the outside world.

Rudaw English has also learned that authorities have detained numerous individuals for accessing the global internet via VPNs, which are widely used in Iran to create encrypted tunnels that mask users’ identities and digital locations, as well as for using Starlink devices that provide high-speed satellite internet connectivity.

“I paid 100 million [Iranian] rials [around $66] for unlimited access,” a resident in the Kurdish-majority Kermanshah province in western Iran, who spoke on condition of anonymity out of fear of reprisal, said.

“Many people and businesses are suffering because of the shutdown,” he added.

Iranians are having to pay millions of rials to access the internet at a time when the national currency earlier this year hit a record low of 1.45 million rials to the US dollar.

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