Iran and west retreat from confrontation

Iran and the main western powers on Tuesday stepped back from an immediate confrontation over Tehran’s nuclear programme as George W. Bush, US president, welcomed a suggestion by Iran’s new conservative president that negotiations should continue, even as work proceeded on reactivating a mothballed uranium facility.

Meanwhile, in Vienna an emergency board meeting of the International Atomic Energy Agency (IAEA) – called on Tuesday by the EU3 of France, Germany and the UK – heard calls for “maximum restraint” by Mohamed ElBaradei, the head of the United Nations nuclear watchdog.

The meeting was expected to continue on Wednesday as diplomats sought to keep alive two years of negotiations between Iran and the EU3 that appeared on the brink of collapse in recent days.

Iran forcefully rejected a package of political, economic and technical incentives presented by the EU3 last week in exchange for Iran maintaining its suspension of work on developing the full nuclear fuel cycle. Insisting on its right to do so and denying it had a clandestine weapons programme, Iran recommenced the initial stages of work at its Isfahan uranium conversion facility on Monday.

Mahmoud Ahmadi-Nejad, Iranian president, on Tuesday spoke to Kofi Annan, the UN secretary-general, assuring him that Iran was ready to keep talking despite what he called an empty and insulting package of proposals by the EU3. “Of course I have new proposals and initiatives which will be presented after the establishment of the government,” he said, referring to his new cabinet being formed this month.

Mr Bush called the Iranian president’s remarks “a positive development”. But he also reiterated that the west remained “deeply suspicious” of Iran’s nuclear ambitions, and said the US would work closely with the EU3 on the “consequences”, including referral to the UN Security Council, if Iran ignored the demands of the international community.

Separately, European officials conceded that the EU3 and the US could face difficulties in securing a majority on the 35-nation board of the IAEA to refer Iran to the UN Security Council because of opposition by the non-aligned countries.

The first western objective was a resolution or statement urging Iran to maintain its suspension, diplomats said.

Mr ElBaradei urged all sides to keep talking. However, despite his call for restraint and his criticism of what he called Iran’s unilateral decision to resume activity at Isfahan, Iran requested that the IAEA remove seals at the facility.

Iran was expected to proceed today with work that would lead to production of uranium hexafluoride gas, thereby crossing a “red line” of the EU3. Ali Aghamohammadi, spokesman for Iran’s Supreme National Security Council, told the FT it would take about 15 days for the section at Isfahan under seals to operate. But he also said Iran would not restart the next stage of uranium enrichment at its Natanz plant “for the time being”.

The western powers appeared to be stepping back from their threat, expressed last week directly to Iran, to break off talks and go to the UN should Iran reactivate the Isfahan plant.

Diplomats suggested there was only a small window for talks. Philippe Douste-Blazy, the French foreign minister, said it was still possible to negotiate with Iran. “We are still holding out our hand,” he said.

The EU3 proposal has been backed by the US but does not go as far as the Bush administration wants. The US has called for the dismantling of Iran’s facilities at Isfahan and Natanz, while the EU3 has proposed that they work with Iran “to establish a group to identify alternative uses” for the installations.

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