Kathmandu— Iran’s president and supreme leader have publicly addressed the significant economic impact of six months of conflict with the United States, citing sanctions and a naval blockade that have caused exports and imports to decline by approximately 35 percent. While acknowledging the hardship faced by citizens – including soaring inflation reaching 66 percent annually – Iranian leaders pledged to continue both diplomatic efforts and maintain defensive capabilities, particularly regarding control over the Strait of Hormuz. The government has identified addressing economic fallout as a central focus, with plans to curb inflation, create jobs, and reduce reliance on the US dollar.

Economic Impact Deepens

President Masoud Pezeshkian revealed that Iranian foreign trade had fallen by nearly 35 percent due to sanctions and port blockades. Despite these challenges, Iran reportedly managed to sell approximately 90 million barrels of oil during a brief period in June when a memorandum of understanding with Washington allowed for limited sales. Residents of Tehran have described significant disruptions to daily life, with many forced to seek employment to cope with rising costs.

Leadership Calls for Economic Solutions

Supreme Leader Ayatollah Mojtaba Khamenei issued a statement urging the government to prioritize addressing economic challenges such as inflation, unemployment, and price management. The call came after his father, Ayatollah Ali Khamenei, was killed in an attack that initiated the conflict six months ago. Omid, a food business owner, noted the impact of rising rents on trade, stating, “We can barely afford to pay our workers.”

Balancing Diplomacy and Defence

The Iranian government has framed diplomacy and defence as equally important pillars for protecting national interests and territorial integrity. President Pezeshkian advocated for dialogue and improved relations with neighboring countries, while the supreme leader emphasized domestic unity and social cohesion. Al Jazeera’s Sinem Koseoglu reported from Tehran that the government is actively promoting a message of national unity.

Military Posture Remains Defiant

Despite economic pressures, Iranian military officials have maintained a strong stance. Army commander-in-chief Amir Hatami claimed Iran continued to utilize its drone and missile capabilities “with the utmost intensity” even as the enemy attempted to destroy them. Acting Defence Minister Majid Ibn Reza hinted at future developments, stating that Iran has “surprises” in store for its adversaries.

Qatar’s prime minister recently met with Iranian leaders to discuss the importance of maintaining open shipping lanes through the Strait of Hormuz, with talks described as ‘creative.’ The situation remains fluid as Iran navigates a complex interplay of economic hardship, diplomatic initiatives, and military posturing.

(With inputs from Al Jazeera)

Originally published on abcnews.com.np.