The Islamic Republic of Iran is an upper middle-income country that has made notable progress in human development.
According to UNDP calculations, between the years 1980 and 2013, Iran’s Human Development Index (HDI) value increased by 67 per cent – or at an average annual increase of about 1.6 per cent.
Iran’s HDI value for the year 2013 was 0.749. This puts the country in the “high human development” category. Its current position is 75th out of 187 countries.
Iran is on track to achieve the Millennium Development Goal 1 - Eradicate Extreme Poverty and Hunger. Iran has witnessed a decline in extreme income poverty, with only 1.39% of the population living in less than two US Dollars per day.
Although the main components of human development in Iran have improved significantly over decades economically, and despite sustained growth rates, the country still faces challenges from unemployment, low labour productivity growth rates and sustained income inequality.
According to joint Government/United Nations reports, much of the income and non-income poverty is in areas such as informal urban settlements; the informal sector of the economy; remote rural areas; among refugees; and encompassing groups such as people with disabilities, child labourer’s and poor female-headed households.
The Government now is seeking to reduce inequality to a Gini coefficient level of 0.3 by the end of the 5th Five Year National Development Plan period (2011 – 2015).