The government plans to sell off 80 percent of its stake in a range of state-run industrial companies in the banking, media, transportation and mineral sectors under an order issued by Khamenei.

The move is likely to lead to a major upheaval in the economy, which is currently about 80 percent state controlled.

Iranian President Mahmoud Ahmadinejad had said in mid-May he planned to reverse privatisations carried out by the former reformist government if the companies involved had been "unjustly turned over, thus violating people's rights."

"Within the framework of privatization, public properties and factories worth billions of rials (millions of dollars) were sold off at cheap prices to some groups," he said.

Khamenei's order does not affect the oil and gas industry in Iran. The country is the second largest oil exporter in the 11-member Organization of Petroleum Exporting Countries and the fourth largest in the world.

State television said last month that Iran expected to earn 60 billion dollars from oil exports in the current financial year to March 20, 2007.

Under the Khamenei plan, certain industries affiliated with the armed forces may be sold off -- vehicle manufacturering, spare parts and infrastructure construction -- provided they are not involved in production for defense and security purposes.

The new plan is considered an amendment to the constitution, which stipulates that certain sectors are to be publicly owned and administered by the government.

According to the constitution the state sector embraces "basic industries, foreign trade, major minerals, banking, insurance, power generation, dams and large-scale irrigation networks, radio and television, post, telegraph and telephone services, aviation, shipping, roads, railroads and the like."

The leader's order also excludes seven banks, the Aviation Organisation, the Ports and Shipping Organisation and basic companies in the telecommunications sector.

The former head of Tehran's Chamber of Commerce, Mohhmad Reza Behzadian, said the move amounted to a major change in the old constitutional attitude toward the economy as the absolute property of the government.