Analysis: Iran prepares for potential ten-year war with US with 200 percent military budget increase.

As reported by ISNA on July 13, 2025, Iranian military leaders and lawmakers have doubled down on long-term defense readiness following the country’s twelve-day conflict with Israel and the United States in June 2025. Brigadier General Mohammad Reza Ashtiani, Deputy Chief of the General Staff of the Armed Forces and former Minister of Defense, stated that Iran has enough military supplies to sustain a decade of warfare, if necessary. His remarks coincided with the Iranian Parliament’s approval of the general outlines of a draft bill to reinforce the country’s defense capacity, which mandates full funding for the 2025–2026 military budget, payment of outstanding allocations from the previous year, and the unlocking of foreign-held financial assets for emergency use under the Armed Forces General Staff.
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Over the past five years, Iran has expanded its armed forces through both personnel reinforcement and institutional structuring across all service branches, but also by claiming a 90 to 93 percent self-sufficiency to produce a wide spectrum of military assets. (Picture source: IRNA)

Ashtiani declared that Iran’s equipment had not suffered significant damage during the recent war and asserted that the country holds enough military reserves to continue fighting for ten years, if required. He stressed that morale, rather than just materiel, plays the dominant role in warfare, referencing the concept that “morale makes up three-quarters of combat power.” He further stated that Iran’s armed forces are not only equipped with advanced weaponry but also possess extensive operational experience and training. Contrasting Iran’s condition with that of its adversaries, Ashtiani claimed that enemy forces may possess modern weapons but lack morale and psychological resilience. These comments were made in the context of renewed national debate over military preparedness, following significant regional escalation and internal discussion over the country’s defense budgetary direction.

In parallel, the National Security and Foreign Policy Committee of Iran’s Parliament approved the general framework of a draft bill sponsored by Tehran lawmaker Ali Khezrian and signed by 120 members of parliament. This proposal is designed to ensure uninterrupted military funding, particularly in the wake of recent hostilities. The bill comprises a single article with three binding clauses. The first clause requires the Plan and Budget Organization and the Ministry of Petroleum to fully pay the entire 2025 defense budget and also to settle all unpaid allocations from 2024. The second clause directs the Planning Organization to disburse 100 percent of annual National Security Council-approved defense expenditures. The third clause obliges the Central Bank to allocate blocked foreign assets and other resources to cover emergency defense requirements. The bill, which was endorsed during a parliamentary session attended by senior officials from the Ministry of Defense, the General Staff, the Islamic Revolutionary Guard Corps, and the Artesh, is now under review by the committee’s defense subcommittee for final amendments and preparation for a full vote.

This legislative initiative follows a previously enacted 200 percent increase in the defense budget in October 2024, which raised military spending from approximately 7,220 trillion rials (about $15.7 billion) to an estimated $46 billion for the 2025 fiscal year. Reports from Iran International and IFP News indicate that the bill also mandates the Ministry of Petroleum and the Budget Organization to finance the full extent of the defense budget without deferral or compromise and to resolve all prior-year financial shortfalls for special defense programs. The Central Bank, under the new provisions, will be compelled to release previously blocked funds abroad for emergency military procurement and project execution. These obligations formalize mechanisms that had until now been handled through ad hoc decisions and discretionary orders. The proposed legislation also includes a requirement that annual military appropriations determined by the Supreme National Security Council be honored in full, further reinforcing the centralization of defense budgetary authority under military leadership and high-level political bodies. The law is widely interpreted as a formal response to Israeli strikes on Iranian military infrastructure and leadership during the June 2025 war.

The recent conflict, often referred to in Iranian media as the “twelve-day war,” began on June 13 and included direct Israeli and American attacks on Iran’s underground nuclear and command facilities, including a reported bombing on June 16 that left President Masoud Pezeshkian injured. According to Fars News Agency, six precision-guided munitions struck access points and ventilation systems of a protected site in Tehran, leading to a power outage and forcing an evacuation via an emergency shaft, during which the president reportedly sustained leg injuries. The Iranian response included launching hundreds of drones and missiles at Israeli targets and striking the U.S. Al-Udeid Air Base. These events led to Operation True Promise III, a military campaign characterized by the use of both conventional and unmanned systems, aimed at demonstrating Iran’s retaliatory capabilities. A ceasefire was reportedly achieved by June 24, after Israeli withdrawal from specific operational zones. In this context, General Ashtiani’s remarks about a ten-year war and the parliamentary defense bill appear to function jointly as both deterrent signaling and institutional preparation for long-term military engagement.

Iran’s armed forces are composed of several main branches: the regular Army (Artesh), the Islamic Revolutionary Guard Corps (IRGC), the Law Enforcement Command (FARAJA), and the General Staff of the Armed Forces. In the 2025–2026 budget, a disproportionate share of resources has reportedly been allocated to the IRGC in comparison with the regular military, reinforcing a broader trend identified by analysts over recent years. According to Iranian sources, the total proposed defense budget for 2025 stands at around 865,000 billion tomans, a nearly 76 percent increase from the 2024 allocation of approximately 496,000 billion tomans. A significant share of the new budget is earmarked for the retirement system of military and intelligence personnel, reflecting both demographic and institutional imperatives. The financial and administrative tools provided by the new draft law would allow uninterrupted continuation of defense development programs, including those involving missile production, drone systems, and cyber warfare capabilities. The proposed funding will also support efforts to recover and modernize equipment damaged in the June conflict, despite government claims that overall materiel losses were limited.

Ashtiani declared that Iran’s equipment had not suffered significant damage during the recent war and asserted that the country holds enough military reserves to continue fighting for ten years, if required. (Picture source: ISNA)

These defense reforms take place amid wider geopolitical and economic conditions, including persistent sanctions, constrained access to foreign markets, and high inflation. International outlets such as Bloomberg and the Financial Times have noted that Iran’s missile and satellite programs remain active despite economic headwinds, and that the government continues to prioritize military spending. While no official figures exist regarding the precise cost of Iran’s space and missile programs, their visible continuation underlines Tehran’s decision to emphasize military readiness despite external economic pressure. The legislative developments, combined with official military declarations, indicate a comprehensive alignment between Iran’s defense policy, national security doctrine, and budgetary strategy. Whether these moves succeed in achieving their intended deterrent effect or instead contribute to greater regional instability remains a matter for future developments, but Iran’s current posture suggests a readiness to institutionalize long-term defense mobilization regardless of international constraints or internal economic costs.

Over the past five years, Iran has expanded its armed forces through both personnel reinforcement and institutional structuring across all service branches. The conventional armed forces currently comprise around 610,000 active-duty personnel and 350,000 reservists, totaling approximately 960,000, excluding paramilitary components. The Islamic Revolutionary Guard Corps (IRGC) fields an estimated 300,000 personnel, including specialized ground forces, naval units, and the Aerospace Force. The Law Enforcement Command (FARAJA) adds further capacity, and the Basij, as an auxiliary mobilization force, is reported to have membership ranging from several hundred thousand to potentially several million. This framework allows the Iranian defense establishment to maintain a large pool of personnel with various levels of training and readiness, enabling force rotation, regional deployments, and support for strategic depth across internal and external theaters of operation.

Iran has prioritized domestic equipment production alongside limited foreign procurement to develop and modernize its military inventory. The Defense Industries Organization (DIO) and Iran Electronics Industries (IEI) lead the country's manufacturing efforts, supported by approximately 3,150 domestic companies and 92 academic and technical institutions. Official claims of 90 to 93 percent self-sufficiency are based on the ability to produce a wide spectrum of systems, including armored vehicles such as the Zulfiqar main battle tank and Rakhsh APC, artillery platforms, tactical ballistic missiles like the Fath-360, and UAVs such as the Mohajer-6, Mohajer-10, and Kaman-22. In parallel, Iran confirmed the acquisition of Russian Su-35 fighter jets in January 2025, though the quantity delivered and their integration into service have not been independently verified. In the naval sector, key developments include the Shahid Soleimani-class catamaran corvettes, featuring missile and air-defense systems, and the IRIS Shahid Bagheri, a 41,000-ton converted container ship configured as an unmanned aerial vehicle launch platform, with surveillance, missile, and rotary-wing capabilities.

Iran’s military posture has continued to rely on affiliated non-state actors across the region, supported through the IRGC Quds Force. Iranian military equipment, including UAVs, missiles, and communications systems, has been supplied to groups such as Hezbollah in Lebanon, the Houthis in Yemen, and various militias in Iraq, Syria, Gaza, and Sudan. Iranian drones, particularly models like the Shahed-136, Mohajer-6, and Ababil, have been used in conflicts beyond the region, including in Ukraine, where Russian forces have deployed Iranian-supplied systems or derivatives. Between 2022 and 2024, production rates increased and export activity expanded. In parallel, Iran has developed and deployed new electronic warfare and cyber capabilities, with IEI reporting the introduction of thousands of systems linked to command and control, surveillance, and communications. Satellite integration and unmanned systems coordination have also advanced, supporting broader implementation of ISR and precision strike capabilities. These combined efforts across personnel, equipment, proxy force support, and technical modernization characterize the core of Iran’s military development between 2020 and 2025.