Iran is an Islamic republic with a theocratic system of government combining religious authority with elected institutions. Its economy, one of the largest in the Middle East, is dominated by the hydrocarbon sector and significant state control. Key economic sectors include oil and gas production, petrochemicals, agriculture, manufacturing, and mining. Despite having substantial natural resources, educated population, and strategic location, Iran's economy faces significant challenges due to international sanctions, limited access to global financial systems, and state control over key industries. The country maintains its own currency (Iranian Rial), though it faces ongoing issues with inflation and currency devaluation. While efforts have been made toward economic diversification, the economy remains heavily dependent on oil revenues and is significantly impacted by geopolitical tensions and international relations.