The decision by Iranian authorities allowing pilgrims who wish to visit holy sites in neighboring Iraq to pay visa fees at the rate afforded to importers on the secondary foreign currency market has sparked criticism from both religious and non-religious segments of Iranian society. The controversy is partly fueled by the government’s parallel adoption of policies that seem to increase the cost of leisure travel as part of its austerity measures in the aftermath of the nosedive in the value of the national currency.

On Sept. 18, each dollar was traded for 145,000 rials on the open market — 86% higher than a month before. Over the past year, the rial has lost roughly 70% of its value in what experts believe is a result of a combination of factors, including a massive rise in liquidity in recent years, economic uncertainty resulting from the US withdrawal from the 2015 nuclear deal, and corruption in Iran. Rates on the secondary currency market, where exporters may sell their hard currency proceeds to importers at a negotiated level, hover slightly below the open market rate. The official dollar rate has been fixed at the much lower level of 42,000 rials and set aside for authorized imports of a list of essential goods.

As a result of the rial devaluation, the cost of food, cars, medicine and many other commodities have recorded significant rises in recent months. While imported products are directly affected by the weakening of the national currency, domestically produced goods have also been impacted given the rise in costs of imported raw materials. Meanwhile, to curb the currency outflow associated with leisure travel abroad, the government has increased the departure tax — especially for those who travel frequently — while also putting an end to previous subsidized foreign currency for tourism purposes.

Yet at the same, in connection with the ongoing Shiite holidays in the Islamic month of Muharram and culminating on the day of Ashoura — which falls on Sept. 20 this year — Iranian authorities have announced that pilgrims who wish to attend the upcoming Arbaeen rituals in the Iraqi city of Karbala, where the third Shiite imam is buried, will be able to pay for visa fees at the rate on the secondary foreign currency market. Given that use of the US dollar has been eliminated in transactions between Iran and Iraq, the equivalent of the $41 fee will be calculated in Iraqi dinars or euros. Of note, Arbaeen commonly attracts a massive number of Iranian pilgrims to Iraq. It is marked 40 days after Ashoura, which is the martyrdom anniversary of the third Shiite Imam Hussein — a grandson of Prophet Muhammad.