Nuclear Crisis

[Rasputin]

A little over a month ago, Iranian President Mahmoud Ahmadinejad proudly announced that Iran had joined, as he put it, those countries which have nuclear technology.

He was speaking in the wake of a series of successful experiments in which Iranian scientists had taken uranium hexafluoride gas, introduced it into a small number of centrifuges, and produced a small quantity of low enriched uranium.

The message was simple. Iran's enrichment programme was under way and there would be no going back.

But Iran's technical capabilities may not be quite as advanced as they would have the world believe.

Western diplomatic sources have told the BBC that there is a very strong probability that the uranium hexafluoride gas used in these experiments was not made by the Iranians at all.


Iran says its nuclear programme is peaceful

They say that it may well have come from a small stock of material sold to Iran by China back in 1991.

This sale took place just before China itself joined the Non-Proliferation Treaty regime; hence before it was bound by the strict export controls that the treaty demands.

Indeed, diplomats say that it was China's decision to inform the International Atomic Energy Agency of this sale a few years later, that helped to start the process of unravelling what the Iranians were really up to.

Nuclear experts say that, in many ways, it is not surprising that Iran should use the Chinese material in its initial experiments.

Iran is widely believed to have had some problems with impurities in its own production of uranium hexafluoride gas.

Hence it would be logical to use the good quality Chinese material to test out its enrichment machinery.

Whether or not the experiments also used Iranian-manufactured feed-material is unknown.

'Propaganda move'

The Iranian move clearly had great propaganda value.

Iranian President Mahmoud Ahmadinejad is clearly proud of the Iranian scientists' achievements.

But there may also have been a clear political purpose: to demonstrate that the Iranian enrichment programme is now a reality and to put down a marker that in the event of any future deal, Iran's right to conduct at least some enrichment activity will have to be acknowledged.

Think tanks and policy experts have produced a variety of plans to resolve the nuclear row with Iran.

Increasingly these do tend to allow the Iranians the right to limited enrichment activities: bowing, if you like, to the "fact" that Iran has seemingly already mastered the necessary technology.

The uncertainty surrounding Iran's technical progress underscores the broader questions about its overall nuclear ambitions.

Iran, of course, strenuously denies having any desire to develop a nuclear bomb.

But opinion differs as to how long it might take the Iranians to develop a "break-out" capability: that is to have a sufficiently capable civil enrichment capacity to allow them to renounce their treaty obligations and to push at full speed for a bomb.

And the uncertainty also highlights another fact, admitted by Western officials at least in private - that their hard intelligence on Iran's nuclear programme is as limited as their knowledge of Iraq's nuclear activities prior to the 2003 US-led invasion.

[Rasputin]

The EU is calling on world powers to help Iran's nuclear and other industries if Tehran stops enriching uranium but wants Russia and China to join in sanctions, including an arms embargo, if Iran does not, according to a copy of a draft proposal seen by AFP.

The proposal by the trio of Britain, France and Germany says world powers should support Iran's building several light water reactors, set up a nuclear fuel bank and even have the United States drop restrictions on Iran's buying US commercial airplanes, if Iran takes steps to guarantee it will not make nuclear weapons.

But if Tehran does not do this, sanctions should follow including an arms embargo, in an escalating international standoff over an Iranian civilian nuclear power program which the United States claims hides the development of atomic weapons.

An arms embargo "would have a significant impact on Russian and Chinese arms sales to Iran," non-proliferation analyst Gary Samore said, referring to the two nations extensive trade ties with their Iranian ally.

"The question mark is whether the Russian and Chinese will sign up to the sanctions part," said Samore, a former White House official now at the McArthur Foundation in Chicago.

The four-page draft text, to be discussed among the EU-3, plus China, Russia and the United States in London next Wednesday, lists 15 targeted sanctions for the UN Security Council to choose from, doling them out as graduated "proportionate measures," if Iran does not comply.

The sanctions are divided into "measures targeted against Iran's nuclear and missiles programmes" and "political and economic measures" and include the arms embargo, a "visa/travel ban on selected high-ranking officials and personalities" and a "freeze of assets of individuals and organizations connected to or close to the regime."

But the benefits include Russia enriching uranium for Iran, with Tehran as a partner "in an international fuel cycle center in Russia," the text said.

A senior European diplomat noted that the text also "talks about security but the word 'security guarantees' does not figure," as Washington is against giving Iran assurances that it will not be attacked.

The United States, which charges that Iran is using a civilian nuclear program to hide the development of atomic weapons, backs the text "on certain conditions," a Western diplomat said, without elaborating.

The European diplomat said Washington needs to join any future negotiations with Iran, something it now refuses to do, as this would be the only way to convince Tehran that it will get benefits.

For instance, European companies that make light water reactors, less of a proliferation risk than the heavy-water type, would not deal with Iran without a green light from Washington, as they have large business dealings with the United States.

Samore said Russia and China "may say they can agree to the package but only if the United States agrees to participate in multilateral talks with Iran."

"This would put the Bush administration in a very difficult position," Sameore said.

Diplomats are pessimistic about finding a deal which would be acceptable to Iran, since Tehran has already rejected any halt in uranium enrichment, which makes fuel for nuclear power reactors but also atom bomb material.

But Samore said that if the Russians and Chinese back tough sanctions, "then Iran might sign on to accept conditions for resuming negotiations."

Russian and China, however, "are likely to press for changes in the text," the Western diplomat said, particularly as they fear sanctions could be a step towards military action against Iran.

The draft text says that "in the event that Iran does not cooperate with the international community," sanctions could be chosen "adopted under Chapter VII, Article 41 of the UN Charter."

This article mandates measures to enforce Security Council decisions but does not include the use of armed force.

Diplomats said this was a compromise gesture to Russia and China as it would make compliance a legal obligation but avoid opening the door to war.

The draft, entitled "possible elements of a revised proposal to Iran", affirms "Iran's inalienable right to nuclear energy for peaceful purposes".

But it says that Iran must cooperate fully with inspectors from the UN's International Atomic Energy Agency and "suspend all enrichment-related and reprocessing activities and to continue this" during negotiations on Iran's nuclear program.

The Security Council on March 29 had asked Iran to honor IAEA calls for it to suspend its enrichment work and also to cooperate fully with an IAEA investigation, ongoing for three years, which has so far been unable to determine whether the Iranian nuclear program is peaceful or weapons-related.

[Rasputin]

A new rival to 'regime change'

Ever since President Bush's "axis of evil" speech in 2002, US policy for dealing with the nuclear programs of what it considers to be "rogue states" has rested on one cornerstone: regime change.
Iraq cemented the widely held estimation that for the Bush administration, the only way to satisfactorily deal with a hostile regime's weapons-of-mass-destruction aspirations was to change the regime.

But now, recent developments involving Libya and North Korea suggest that a new tack is at least under consideration - one that could have profound impact on the crisis with Iran over its nuclear ambitions.

In the White House, on Capitol Hill, and among influential deans of US foreign policy, this new rival to the doctrine of regime change appears to be: The international security priority is such that we are prepared to hold our noses and accept your existence, if you forgo nuclear armament.

Policy analysts emphasize that nothing says the regime-change forces have lost the battle yet. But the hints of fierce debate, they say, suggest those forces are no longer as dominant as they once were.

"The days of 'regime change' and the days of being tough with regard to Iran and North Korea are waning, and they are waning because the influence of the people who championed those positions - [Vice President Dick] Cheney, [Defense Secretary Donald] Rumsfeld, and [UN Ambassador John] Bolton - is not as great as it once was," says Henry Sokolski, executive director of the Nonproliferation Policy Education Center in Washington.

Regime change has not necessarily been strictly defined as the US removing leaders from power. Indeed, it has included other means - for example, empowering the people to organize an overthrow themselves. But in each case, the rationale was the same: The regimes were such an international threat that their removal - one way or the other - was the only option.

But an initial hint of some evolution in this policy came last week. The announcement of a restoration of full diplomatic relations with Muammar Qaddafi's Libya set off wide speculation about the timing of the move - especially when State Department officials, beginning with Secretary of State Condoleezza Rice, framed the decision as a message to Iran and North Korea.

Discussion also spread that the United States is considering giving new priority to formal security assurances for Pyongyang as a way to reinvigorate six-country talks on the regime's nuclear program.

The next key window into the Bush administration's handling of rogue regimes could come as early as Wednesday, when the US is scheduled to meet in London to discuss Iran with the other four permanent members of the United Nations Security Council, plus Germany. The six countries are to discuss a new package of incentives and negative consequences to be presented to Iran for either agreeing or refusing to give up its uranium enrichment program.

European officials say they understand the difficulty for the US of either signing on to security assurances for Tehran or entering into direct talks with the Iranian regime. But they note that the US did both to get Libya to abandon its WMD programs - and they worry that the goal of curtailing Iran's nuclear ambitions could be doomed unless the US eventually takes those steps with Tehran.

"Qaddafi wanted to be certain that [the US] goal was not to kill him or to end his regime," notes one European diplomat, drawing a parallel between the Libyan and Iranian cases. "Until the day [the US] says that, we may be in a stalemate," says the diplomat, who asked not to be named because of the ongoing nature of the talks.

But nonproliferation experts say the recent steps on Libya and renewed debate on North Korea may mean the Bush administration is moving toward separating its political ideology from one of its top national-security goals, which has been to stop the spread of WMD to troublesome countries - especially those supporting international terrorism.

"If the US is signaling it is no longer mixing regime change and its nuclear nonproliferation objectives, that would be very useful," says Daryl Kimball, executive director of the Arms Control Association in Washington. The US approach to North Korea is "not working," Mr. Kimball says, as evidenced by Pyongyang's continued buildup of its nuclear arsenal since talks in September. He says that fact and the lack of options on Iran may be pushing the administration to consider new options.

"They may have learned their own lesson from Libya," Kimball says, "that the most effective way to persuade a rogue state to dismantle its WMD program is to assure that state that its government won't be overthrown."

Of course, not everyone agrees that's the lesson of Libya. Mr. Sokolski of the Nonproliferation Policy Education Center says the Libyans gave up WMD because "they were convinced they were next on the list" after Iraq. "If you don't have something to hold over these regimes," he adds, "it can be seen as weakness."

Indeed, in part because of the prevailing support for that argument, other experts discount suggestions that the Bush administration is turning its back on regime change. Robert Einhorn, a former diplomat in nonproliferation affairs now at the Center for Strategic and International Studies in Washington, says he sees no sign the White House is heeding building pressures to engage with WMD foes.

He cites a recent Washington Post column in which Henry Kissinger recommends the US enter into talks with Iran - or face a destabilizing expansion of the world's nuclear club. "But I don't see the administration buying into that perspective," he says, "any more than I see them giving the nuclear problem parity with their other concerns about these regimes."

But others place the North Korea and Iran issues in the context of an ongoing foreign-policy debate in the administration - and they see the rise of those in the Kissinger vein as having an impact. "We're seeing the ascendency of the pragmatists over the ideologues, but we don't know yet if that rise is anything definitive," says Joseph Cirincione, an analyst at the Center for American Progress in Washington.

Pointing to the administration's internal debate over extending an olive branch to North Korea, he says, "It may be about more than North Korea: It may be the first step in a reorientation of US proliferation policy."

For that to be the case, however, Mr. Cirincione says it would take acknowledgment that regime change is off the table - something not all White House quarters appear ready to do. "The day Vice President Cheney gives a speech about negotiating with the North Koreans," he says, "then it will be a done deal."

[Rasputin]

UN powers to discuss Iran atomic incentives

United Nations Security Council powers meet on Wednesday to try to hammer out a joint strategy to stop Iran enriching uranium and to consider a package of incentives drafted by European countries.

Officials from the United States, China, Russia, Britain and France (all veto-wielding permanent members of the Security Council) and rotating member Germany will discuss the next step in efforts to head off a crisis over Tehran's nuclear program.

The United States and some of its allies suspect Iran's nuclear program is a cover for efforts to develop atomic weapons. The Islamic Republic says it is developing nuclear technology for civilian power generation.

Officials will discuss an offer of incentives, combined with threats, drafted by the European Union trio aimed at getting Tehran to freeze uranium enrichment, which can be used as a nuclear fuel and is a key component of atomic weapons.

"We are undertaking work to spell out more clearly the benefits Iran would enjoy from cooperating -- and equally the further isolation that would result if Iran failed to cooperate," said a British official.

The EU package may include an offer of a light-water reactor and an assured supply from abroad of fuel for civilian atomic plants so Iran would not have to enrich uranium itself.

There could also be warnings of possible sanctions against Iran, which is the world's fourth largest oil producer, if it declines the offer.

However, doubts linger that such a package will be acceptable to Iran, which last week ruled out halting its sensitive nuclear work.

One of the most sensitive areas is the question of security guarantees from the United States.

Some EU officials, the U.N.'s International Atomic Energy Agency and many analysts believe Iran could be motivated to stop activity that could lead to nuclear bomb-making only with a U.S. pledge not to try to topple the Islamic Republic's government.

But Washington has dismissed the notion of guarantees to Iranian leaders who repeatedly call for Israel's destruction and whom it sees as orchestrators of anti-Western terrorism. Tehran, in turn, has said such guarantees could not be trusted.

The United States says it wants a diplomatic solution to the standoff but has not ruled out military action.

Officials will discuss how to present the package to Iran as well as the substance of the offer at Wednesday's meeting, diplomats said.

If Iran rejects the package, Washington will seek to pursue a U.N. Security Council resolution which includes sanctions.

[Rasputin]

It is hard to imagine the sleepy provincial town of Natanz ever being at the centre of a conflict.
Home to about 40,000 inhabitants, it is the kind of place that closes down for a very long siesta after lunch.

But behind the craggy mountains overlooking Natanz - where Alexander the Great's troops once marched - lies Iran's most sensitive nuclear site.

Its anti-aircraft guns are visible from the main road, even though much of the plant is underground.

If there are ever military strikes on Iran, the uranium enrichment facility at Natanz is likely to be the first target.

People think there is a possibility they could attack any moment

Natanz inhabitant
Twenty five kilometers away in the town of Natanz the highlight of the week is the Thursday bazaar.

It is a modest affair with fruit and vegetable sellers sit on the floor selling their produce.

Natanz - some 250km (150 miles) south of Tehran - used to be known for its juicy pears from the orchards surrounding the town, but now it has a new kind of fame.

Good prospects

Atomic energy has put Natanz on the map.


The highlight of the week in Natanz - the Thursday market
"It makes us proud that the whole of the world has now heard of the name of our town because of the nuclear site," says vegetable seller Mr Rustami.

There is no sense of panic about the future in Natanz - like every town in Iran it is growing in size.

"It has got better here because young people can go to the nuclear site and find a job; it's made a big difference," says Mujtaba, a young trader at the bazaar.

"I have a question for Mr Bush," says Mohammad Javad. "Why shouldn't we have this technology if everyone else has it? If it's so good why shouldn't we have it?"

Then he adds that if everyone dies defending Iran's rights, he doesn't care as it's an investment for the future.

Wanting to leave

But the housewives shopping in the bazaar have a somewhat different view.

"As God is my witness we cannot sleep at night; every moment I think they are coming to bomb our city," says Soheyla, who's clad in an all enveloping black chador.


"People are worried, but they don't show it," says one woman
Her family moved to Natanz from Tehran 12 years ago and now she wishes she could afford to leave.

"All people here are worried but they don't say so or show it," she says. She refuses to allow us to take her picture for fear of getting into trouble.

"Let me tell you people in this town are worried and worn out," she says. "People think there is a possibility they could come and attack any moment because the foreigners know very well where this site is."

Soheyla's views are echoed by other women, but the fears here are vague and ill-informed.

Nobody talks about the possibility of radiation leaks if there were ever an attack. In public at least the men put on a brave face.

They simply won't admit they're worried because, in this deeply religious town, they say they trust in God to protect them.

[Rasputin]

New incentives for Iran to give up its controversial nuclear programme are being discussed by the five UN Security Council permanent members and Germany.
Britain, France and Germany are proposing a number of technology, trade and security benefits for Iran.

Possible sanctions if Iran rejects the offer are also expected to be included.

Meanwhile the Washington Post newspaper reports that Tehran has requested, through intermediaries, direct talks with the US over the issue.

But Iranian President Mahmoud Ahmadinejad remained defiant on Wednesday, telling a televised rally: "Using nuclear energy is Iran's right."

'More talks likely'

Europe's "big three" are presenting their proposals to the US, Russia and China at a closed-door meeting in London.

The draft package is expected to offer Iran help with building light water reactors that do not produce plutonium waste, a nuclear fuel bank that would guarantee Iran access to reactor fuel, as well as a series of security guarantees.

If they do the slightest damage to the Iranian people, if they commit the slightest aggression, they will receive an historic slap

Mahmoud Ahmadinejad
Iranian president

But the talks are aimed as much at overcoming differences among the six participants as winning over Tehran, says BBC diplomatic correspondent Jonathan Marcus.

Russia and China - both veto-holding members of the council - want Iran to be persuaded not threatened, and may object to the inclusion of a threat of sanctions.

The US and some European governments are seeking a tough resolution on Iran at the council.

But there have been recent differences between the two over the contents of any deal. Wednesday's meeting was originally meant to have been held last week but was postponed so the differences could be ironed out.

One anonymous official told Reuters news agency that he did not expect "full closure" at the meeting and said "more talks next week" were likely.

'Desire for dialogue'

The Washington Post on Wednesday quoted unnamed US officials and foreign diplomats as saying Iran had requested a meeting with the US through Indonesia, Kuwait and UN Secretary General Kofi Annan.

Iran's chief nuclear negotiator, Ali Larijani, passed on the same message to Mohamed ElBaradei, head of the International Atomic Energy Agency, the paper said.


Iran says its nuclear programme is for peaceful purposes

It comes two weeks after Mr Ahmadinejad sent a surprise letter to President George W Bush, in which he spoke of the war in Iraq among other issues.

The letter was dismissed by Mr Bush as nothing new.

But US officials, speaking on condition of anonymity, say government experts are now exerting pressure on the Bush administration to respond, the Washington Post reports.

It is now two months since the UN Security Council first ruled that Iran should halt its uranium enrichment activities.

Mr Ahmadinejad told a rally at the south-western border town of Khorramshahr that Iran had "mastered the entire nuclear fuel cycle, from start to finish, thanks to young Iranian scientists".

"The enemies are looking to plot and want to create differences among Iranians to stop us getting our rights," he said.

"But if they do the slightest damage to the Iranian people, if they commit the slightest aggression, they will receive a historic slap."

[Rasputin]

Iran Requests Direct Talks on Nuclear Program

Iran has followed President Mahmoud Ahmadinejad's recent letter to President Bush with explicit requests for direct talks on its nuclear program, according to U.S. officials, Iranian analysts and foreign diplomats.

The eagerness for talks demonstrates a profound change in Iran's political orthodoxy, emphatically erasing a taboo against contact with Washington that has both defined and confined Tehran's public foreign policy for more than a quarter-century, they said.

Though the Tehran government in the past has routinely jailed its citizens on charges of contact with the country it calls the "Great Satan," Ahmadinejad's May 8 letter was implicitly endorsed by Iran's supreme leader, Ayatollah Ali Khamenei, and lavished with praise by perhaps the most conservative ayatollah in the theocratic government.

"You know, two months ago nobody would believe that Mr. Khamenei and Mr. Ahmadinejad together would be trying to get George W. Bush to begin negotiations," said Saeed Laylaz, a former government official and prominent analyst in Tehran. "This is a sign of changing strategy. They realize the situation is dangerous and they should not waste time, that they should reach out."

Laylaz and several diplomats said senior Iranian officials have asked a multitude of intermediaries to pass word to Washington making clear their appetite for direct talks. He said Ali Larijani, chairman of Iran's Supreme National Security Council, passed that message to the head of the International Atomic Energy Agency, Mohamed ElBaradei, who arrived in Washington Tuesday for talks with Secretary of State Condoleezza Rice and national security adviser Stephen J. Hadley.

Iranian officials made similar requests through Indonesia, Kuwait and U.N. Secretary General Kofi Annan, Laylaz said. American intelligence analysts also say Larijani's urgent requests for meetings with senior officials in France and Germany appear to be part of a bid for dialogue with Washington.

"They've been desperate to do it," said a European diplomat in Tehran.

U.S. intelligence analysts have assessed the letter as a major overture, an appraisal shared by analysts and foreign diplomats resident in Iran. Bush administration officials, however, have dismissed the proposed opening as a tactical move.

The administration repeatedly has rejected talks, saying Iran must negotiate with the three European powers that have led nuclear diplomacy since the Iranian nuclear program became public in 2002. Within hours of receiving Ahmadinejad's letter, Rice dismissed it as containing nothing new.

But U.S. officials who spoke on condition of anonymity said government experts have exerted mounting pressure on the Bush administration to reply to the letter, seconding public urgings from commentators and former officials. "The content was wacky and, from an American point of view, offensive. But why should we cede the high moral ground, and why shouldn't we at least respond to the Iranian people?" said an official who has been pushing for a public response.

Analysts, including American specialists on Iran, emphasized that the contents of the letter are less significant than its return address. No other Iranian president had attempted direct contact with his U.S. counterpart since the countries broke off diplomatic relations after student militants overran the U.S. Embassy in Tehran in 1979, holding 52 Americans hostage for 444 days.

Iranian analysts said Ahmadinejad's familiar list of grievances on Iraq, Israel and terrorism was designed largely for domestic consumption. CIA analysts and experts on Iran within the government said it also could be interpreted as an attempt to articulate points for possible discussion with Washington.

[Rasputin]

2

"There is no question in my mind that there has been for some time a desire on the part of the senior Iranian leadership to engage in a dialogue with the United States," said Paul Pillar, who was the senior Middle East intelligence analyst with the CIA until last fall.

"Much stranger first steps have led to dialogues than this letter. And as weird as the letter may be, if the Iranians want to begin discussions based on the theme of righteousness, that's something we should not be afraid to engage on," Pillar said. "We have pretty strong arguments about justice and righteousness of our own, so we should not shy away from that."

Inside Iran, the letter effectively widened an opening toward the United States that began in March, with Larijani's unusually public acceptance of an American invitation to direct talks on the situation in neighboring Iraq. That acceptance provoked sharp criticism from hard-liners until it was publicly endorsed by Khamenei.

By contrast, Ahmadinejad's letter sparked lavish praise from perhaps the most conservative cleric in Iran's government, Ayatollah Ahmad Jannati, who chairs the Guardian Council, which oversees Iran's electoral process. Delivering the Friday sermon on May 12 in Tehran, Jannati called it "an extraordinary letter" and "an inspiration by God."

"The taboo is gone, for the first time when someone like Jannati endorses the message," said an Iranian political analyst who said he could not to be quoted by name because his employer had not authorized him to speak publicly.

Earlier attempts at outreach to Washington have been thwarted by conservatives. "The tradition is the hard-liners need American hostility," the analyst said. The most serious attempt was by Ahmadinejad's predecessor, reformist cleric Mohammad Khatami.

"When Khatami tried to do it, the leader rejected it," said the European diplomat. "But I guess they're worried enough. People don't want sanctions. Domestically, it's a good move."

Indeed, by last week, a prominent member of Iran's conservative parliament made headlines proposing talks with members of Congress.

"The taboo of the discussion is gone, but I don't think they've formed a consensus about normalization of relations," said a Western diplomat in Tehran. "But 'let's talk to the Americans' -- that was very controversial until recently."

The change appears rooted at least partly in Iran's political scene, now dominated entirely by conservatives. Pillar pointed out that with reformists driven from government, conservatives no longer fear that political credit for renewing contact with Washington will accrue to a rival domestic force. The Iranian public strongly favors restoring ties.

Laylaz also saw a second reason: Iran's nuclear program, which recently crossed a key threshold by enriching uranium.

"Now we have something to negotiate," Laylaz said. "The nuclear program of the regime has been successful, because five years ago nobody wanted to hear our voice."

Ordinary Iranians appear to approve of Ahmadinejad's overture. His letter remains at the top of the presidential Web site, http://www.president**** .

"We have not had any relations for so many years, and Iran was always accused of being unwilling to talk," Masood Mohammadi, 23, said as he left Friday prayers last week. "Now Iran has taken the first step, and I hope the U.S. president replies in kind."

[Sepideh_UK]

man nemidonam k chera harchi mishe harfe ISLAM ro miyaran vasat...politics is diFFerent 4m RELIGION for uregoo d inFo....IsLam is the Best !!!!!

LISTEN DUDE, This is just called "POLITICS", but these are all religious wars. I mean i do respect ur opinion as well but i think it is all about religion. How come most ( nearly all ) of the Islamic countries don't like Jews . There are so many more examples which will suggest this!! JUST THINK!!

[Rasputin]

Iran has told UN nuclear chief Mohamed ElBaradei it wants nuclear talks with the United States but without preconditions such as its giving up uranium enrichment, diplomats said.

ElBaradei was in Washington Wednesday for talks with US officials, including Secretary of State Condoleezza Rice, after having met in Vienna last week with Iran's top nuclear negotiator Ali Larijani.

"Larijani just said, we want to talk, but as equals, with no preconditions," said a diplomat close to the UN watchdog International Atomic Energy Agency (IAEA) who asked not to be named due to the sensitivity of the issue.

A second diplomat said Larijani had directly mentioned talking with the United States, as well as EU negotiators Britain, Germany and France.

The diplomat, who is close to Iranian sources, said Larijani had however told ElBaradei that Tehran "will not negotiate under pressure or threats" and that it must be able to keep running a 164-centrifuge pilot plant to enrich uranium.

The enriched uranium makes fuel for nuclear power reactors but it can also be the raw material for atom bombs.

The United States refuses to speak directly with Iran but backs the EU-3's diplomatic effort to re-start formal talks to get Tehran to guarantee it will not make nuclear weapons but which collapsed in August last year.

The White House on Wednesday vowed it would hold no direct negotiations with Iran unless the Islamic Republic suspends its uranium enrichment program.

But another diplomat close to the IAEA said the West should not see Iran's keeping small-scale enrichment as a deal-breaker.

The EU-3 met Wednesday in London with China, Russia and the United States on an EU package of trade, security and technology incentives to convince Tehran to stop enriching uranium.

Both Britain and the United States said progress had been made in hammering out an approach to Iran's nuclear programme.

Diplomats said Iran was ready to give up industrial-scale enrichment, which would involve tens of thousands of centrifuges and could make enough enriched uranium in one year for many bombs, as part of a deal.

But Iran insists on keeping the small-scale work it has already started, and which experts say is not an immediate proliferation threat.

Another diplomat with knowledge of the enrichment question said Iran had in any case "already figured out how to do enrichment. That's done. The only thing they would learn from doing more enrichment is quality control," so that fewer centrifuges would break down.

Iran's President Mahmoud Ahmadinejad boasted Wednesday that the Islamic republic had mastered "the entire nuclear fuel cycle from start to finish, thanks to young Iranian scientists."

Nuclear expert David Albright, head of a private think tank in Washington, said however that the Iranians "are making progress but by no means have they mastered the fuel cycle."

"They don't know how to run centrifuges reliably . . . It is not clear they know how to (in the final step) make (the actual) fuel for power reactors," Albright said.

"So it's more huffing and puffing" from the Iranian president, Albright said.

The United States fears that even one centrifuge spinning is too much since it allows Iran to acquire the know-how for enrichment, considered the "break-out capacity" for making nuclear weapons.

Diplomats close to the IAEA said the US approach was flawed.

Tehran has sharply cut down the scope of IAEA inspections since the agency's board of governors took Iran before the UN Security Council for possible sanctions.

"If we allow them to run some centrifuges (and back off from Security Council reprisals), then the IAEA will be allowed to monitor what is going on" and so be able to catch Iran if it tries to use this technology for weapons work, said the diplomat with knowledge of Iran's enrichment program.

Despite the West's hard line on Iran since 2003, the Islamic Republic had moved ahead to first making the uranium gas that is the feedstock for enrichment and now running a 164-centrifuge cascade, the diplomat said.

"What is happening is that every time you delay making a deal, the stakes get higher," the diplomat said.

[Rasputin]

World powers meet to discuss Iran nuclear offer

World powers met in London on Wednesday to discuss a package of incentives and threats drafted by European countries aimed at defusing a crisis over Iran's nuclear program.

Iran's president, however, dampened hopes of any progress by insisting on Iran's right to a full range of nuclear technology, and Britain said it did not expect the meeting to achieve a breakthrough.

Senior officials from U.N. Security Council permanent members China, Russia, the United States, France and Britain, plus Germany, are seeking to narrow divisions over how to proceed to persuade Tehran to halt its uranium enrichment work.

"(The officials) are not really anticipating that today will be the final meeting," British Foreign Secretary Margaret Beckett told reporters shortly before it started. "It will be a key meeting today but I suspect it won't be the final meeting."

Washington and some Western nations suspect Iran's nuclear program is a cover for efforts to develop an atomic bomb.

The head of Russia's atomic energy agency, Sergei ***yenko, had said earlier in Washington he hoped for a "major breakthrough" at the London meeting.

However, it was unclear whether the meeting would resolve serious differences between Washington and Moscow over U.S. demands that Iran face sanctions, resisted by Russia, if it continues to defy the international community.

The Islamic Republic says it is developing nuclear technology for civilian power generation and Iran's President Mahmoud Ahmadinejad issued a defiant message.

"Using nuclear energy is Iran's right," Ahmadinejad told a rally in a speech broadcast live on state television.

"The enemies who could not stop the Iranian nation of reaching nuclear technology by means of political pressure, conspiracies and using the tool of international organizations are now plotting against us," he said.

U.N. Secretary-General Kofi Annan, speaking in Vietnam, said he had appealed to Iran to reassure the world that its nuclear intentions are peaceful and asked it "not to reject anything out of hand" which might emerge from the talks in London.

But one EU diplomat said it was hard to see what the meeting, which started around midday, could achieve.

"It's really just an academic exercise, since the Iranians have made it clear that they won't accept any offer."

U.S.-RUSSIA RIFT

President Bush said countries had to work together to encourage Tehran to halt its nuclear program.

"Obviously we'd like to solve this issue peacefully and diplomatically, and the more the Iranians refuse to negotiate in good faith the more countries are beginning to realize that we must continue to work together," Bush said.

Some EU officials, analysts and the U.N.'s nuclear watchdog -- the International Atomic Energy Agency (IAEA) -- want Washington to engage with Iran.

They believe the only way to entice Iran back to negotiations and getting it to stop its nuclear work would be a U.S. pledge not to try to topple the Tehran government.

Bush said Washington was working with partners, including Russia, to show them that Iran was "showing no good faith."

The package is likely to include an offer of a light-water reactor and an assured supply from abroad of fuel for civilian atomic plants so Iran would not have to enrich uranium itself.

Enriched uranium can be used as a nuclear fuel, but is also a key component of atomic weapons.

The package will also warn of possible sanctions if Iran, the world's fourth-biggest oil producer, refuses the offer.

Diplomats say they would first discuss targeted sanctions, such as visa bans on officials involved in the nuclear program, before seeking ways of curtailing trade deals.

The Washington Post, citing U.S. officials, Iranian analysts and foreign diplomats, reported that Iran was making explicit requests for direct talks with the United States.

The State Department declined to give an immediate comment.

(Additional reporting by David Clarke, Edmund Blair in Tehran, Lou Charbonneau in Berlin, Tabassum Zakaria in Washington.)

[Rasputin]

Germany is playing a leading role in formulating a European response to the ongoing row over Iran's nuclear program, and that is bound to have direct implications for the larger issue of Germany's role and identity in the international system and resolution of the crisis.

For the past three years, the German government has been one of the European troika, along with France and Britain (the EU-3), engaged in nuclear diplomacy with Iran and, despite a change of guards, there is considerable policy continuity on the part of Chancellor Angela Merkel.

Initially Merkel, being a novice and highly critical of her predecessor's policy of distancing German foreign policy from the



US, rattled a few cages with her post-election leaps in bandaging German-US relations, citing Iran as an "example" of how things work between the two countries.

Then came Merkel's blistering criticisms of President Mahmud Ahmadinejad for his remarks on Israel, which she compared in no unmistakable language to fascism. In her trips to both Israel and the United States, Merkel consistently criticized Iran's nuclear and foreign policies, which, in turn, fueled Germany's current role in the Security Council debates on Iran, referred to as "Permanent Five plus one".

While still short of the formal veto power, the historical precedence set by Germany's critical role in the Iran crisis will undoubtedly be an important catalyst in paving the road for Germany's eventual inclusion in the Security Council's exclusive club, which is now limited to the United States, the United Kingdom, France, China and Russia.

This depends to some extent on the global perception of how Germany plays its diplomatic card with regard to Iran. A compliant Germany, subservient to the policy dictates of Washington, is unlikely to receive much backing from the other powers in its current bid to gain a permanent seat at the Security Council. On the other hand, an independent, self-generating diplomacy, based on Germany's, and the European Union's, calculations of risks and benefits, will have the opposite effect. So far, Germany is evincing a middle position, where signs of autonomous diplomacy and old US dependency converge.

On the positive side, Germany's adamant objection to the military option against Iran, which Merkel communicated to President George W Bush in her recent White House visit, is a welcome development that in a certain sense brings Germany closer to Russia and China, both of whom oppose any reference to UN's Article 42, which would set the stage for a future US military action against Iran.

Among the EU-3, Germany is, in fact, the most enthusiastic proponent of the so-called "carrot" approach, including the security approach, favoring direct Iran-US talks.

Yet, contrary to Berlin's wishes, the US has turned down both the Iranian offer of direct talks as well as any "security guarantee" for Iran, the justification being that Iran is a "troublemaker in the world", to paraphrase Secretary of State Condoleezza Rice.

But don't expect the fissures between Berlin and Washington to spill into the open any time soon. Merkel and her ardent pro-American coalition are committed to avoiding any "crisis of confidence" with Washington, which she has blamed on Gerhard Schroeder and his former Green Party foreign minister, Joschka Fischer, who was intensely disliked by the White House.

Fischer's replacement, Frank-Walter Steinmeier, a member of the leftist Social Democrats, has so far proved an invaluable "balancer", bringing a measure of equilibrium to the unbounded tendency of Merkel's Christian Democratic Party to appease the Americans.

[Rasputin]

2

Germany's stakes in the Iran crisis
Germany is Iran's No 1 European trade partner and its booming import-export with Iran will be a net casualty of any UN (or other) sanctions on Iran, compared with the United States, which has practically no economic interests at stake in Iran as a result of 27 years of US sanctions.

Iran is a major market for Germany's industrial and technological products, just as Germany is an importer of Iranian oil and such goods as rugs; some 35% of Iranian rugs are exported to Germany. According to a recent article in Der Spiegel, "Between 2000 and 2005, German exports to Iran more than doubled. Last year they reached a new record of 4.4 billion euros [US$5.6 billion], or 0.6% of Germany's total export volume. Manufacturers of machinery and equipment are the main beneficiaries because Iran is using German know-how to develop its economy."

Another report by the Iran-German Chamber of Commerce indicates that as much as 75% of Iran's small and medium industries rely on imported goods and technology from Germany. German companies and banks are also involved in projects in Iran's industrial free zones.

Indeed, in light of their physical proximity, a large Iranian community in Germany, and so on, there is every expectation of growing economic exchanges and interdependencies between Germany and Iran, absent the nuclear crisis. Because of the crisis, however, these relations have suffered, not the least because of growing US pressure, reflected in the recent news that the US is utilizing anti-terrorist laws to curb European banks' involvement with Iran - with a measure of success.

As a result, as the nuclear row has been upgraded to "pre-sanction sanctions", many German companies have stayed away from Iran and numerous deals in the pipeline, such as on airplanes and parts, power generators, machinery, have been put in limbo. Undoubtedly, such setbacks will be minuscule compared with a few months or a year or so from now when and if the UN or a "coalition of the willing" imposes sanctions on Iran, which will only benefit German black-marketeers.

Indeed, as Mohammed Nahavandian, an economist with Iran's Supreme National Security Council, recently stated, the implementation of sanctions on Iran would be "impractical" because of the size and nature of Iran's many frontiers, but Iran would "incur extra expenses".

Therefore, to safeguard its vested economic interests with Iran, the German government must show a greater independence from the hitherto coercive US approach, thinly disguised as "diplomacy". The US pseudo-diplomacy, if sheepishly followed by Germany and other European countries, will harm their economic interests, this when, to quote former Italian prime minister Silvio Berlusconi, "Europe has to compete with the US in the area of economics and trade, rather than in politics."

What Berlusconi misses is that by following the US diplomatic prescriptions over Iran, Europe's economic and trade interests will suffer, whereas what is needed is an alternative European Iran policy that fully recognizes "Iran's legitimate rights to nuclear technology", to quote Javier Solana, the EU's foreign-policy chief.

However, the problem with the EU's present approach is that, first of all, Iran's right under the Non-Proliferation Treaty (NPT) to nuclear technology does not really require any "recognition" by the EU and others, and to the extent that under the present circumstances such a statement is laden with special meanings, then it must be taken to its logical conclusion and extend to recognizing Iran's right to produce nuclear fuel, per Article IV of the NPT, under the necessary safeguards and surveillance measures of the International Atomic Energy Agency (IAEA). Otherwise, the statement by Solana and other European officials remains vague and indeterminate, denuded of substantive legal connotations.

The question of security guarantee
Security is a two-way process, and if Germany and other Western powers seek Iran's cooperation against global terrorism and the threats of nuclear terrorism, then they must show a better understanding and appreciation of Iran's post-September 11, 2001, security anxieties. The unprecedented influx of US military might in Iran's vicinity has "securitized" Iran's foreign-policy debates for the foreseeable future. Yet the nub of dilemma on the question of security has largely bypassed policy-makers throughout Europe.

That dilemma is as follows: the European suggestion of Iran's inclusion in any regional security infrastructure is naive and simplistic, given the structural conflict between the US and Iran and their ongoing games of strategy. The main reason the US is incapable of formulating an Iran-inclusive security framework in the Persian Gulf is precisely because the operation of Iranian power in the oil region works against the United States' interventionist policies aimed at controlling the access and flow of the strategic commodity relied on by the industrial world, that is, oil and gas.

That is precisely why the US quest for regime change in Iran will never completely disappear, no matter what deals are brokered on the nuclear front. A more prudent political realism on Germany's, and Europe's, part would step down from the wishful hope of full normalization of relations between Iran and the US. Instead, it would work toward bringing a semblance of order and predictability to the antagonistic relations between Tehran and Washington.

Thus calls for more European pressure on the US to make explicit pledges not to interfere in Iran's internal affairs and to put the regime change recipe (for disaster) on the back burner are insufficiently mustered at the present moment. After all, Europe is much more cognizant of the perils of Iran's potential "breakup", and the threats of irredentism with regard to its own security, should the US make good on its own policy of fomenting ethnic divisions inside Iran.

That would mean escalating the Middle East boiling pot to new heights of insecurity, in light of Iran's present importance as a strong centralized government contributing to regional integration and cooperation, something the EU countries can ill-afford.

Unfortunately, neither Germany alone nor the EU as a whole can provide any security guarantee to Iran without US backing, but that does not mean that the EU cannot take proactive steps, such as with respect to influencing the North Atlantic Treaty Organization (NATO) against taking stern anti-Iran steps or promoting Iran-OSCE (Organization for Security and Cooperation in Europe) cooperation, both in the Persian Gulf and the Caspian Sea. The OSCE advances the objective of a UN-like cooperative security framework potentially favored by Iran. Already, Iran has participated in a number of OSCE-sponsored events, for example, on environmental security.

[Rasputin]

3

Building on the past, but which past?
In crafting its Iran policy, Merkel's government must deepen "constructive engagement" with Iran and disregard any suggestion that the EU's Iran diplomacy has been a failure. Rather, the result so far has been mixed, in light of Iran's marathon negotiations, its willingness to implement the Additional Protocol of the NPT, allowing intrusive inspections of its nuclear facilities, as requested by the EU-3 in 2003, until January 2006, when Tehran dropped it in reaction to the EU's backtracking on its promises in the Paris Agreement.

This included, above all, a pledge to respect Iran's "exercise" of its nuclear rights "without discrimination". But, as stated by Iran's chief nuclear negotiator, Ali Larijani, Iran is willing to re-adopt the Additional Protocol and to pass it through the parliament (majlis).

Also, learning from past errors of "nuclear reductionism", that is, reducing the sum of Iran-German relations to the nuclear issue, as warned by some top German experts on Iran, such as Johannes Reissner of the Berlin think-tank Stiftung fur Wissenschaft und Politik, is mandatory if Merkel wishes to make a tangible difference in the present crisis.

As Russian Foreign Minister Sergei Lavrov recently stated, "isolating Iran" will have the adverse effect of augmenting Iran's non-cooperative behavior. The obverse strategy of integrating Iran, reflected in the new European package approach, should not be tactical, however, but only if it is buffeted with the firm guarantees of faithful implementation, will it have a decent chance of success.
From Iran's vantage point, Germany's role in Iran's nuclear program leaves a lot to be desired. The German government failed to take any action when Siemens reneged on its lucrative contract to build the Bushehr power plant, forcing Iran to turn to Russia in the mid-1990s for a project half-finished. Consequently, the present European offer of light water reactors to Iran cannot possibly be taken seriously, short of serious stipulations by the EU that would preclude the recycling of such bitter experiences in the past.

Fortunately, Germany resisted some calls, by Israel and its Washington lobbyists, for excluding Iran from the upcoming soccer World Cup, and there is a possibility of Ahmadinejad's presence at the games, preemptively denounced by the hawkish editorials of the Washington Times, among others.

Merkel would be wise to send Steinmeier to Iran ahead of those games and or to invite Iran's Foreign Minister Manouchehr Mottaki to Berlin, and to decouple to some extent Iran-German trade and economic cooperation from the nuclear row, as an intermediary measure that could well have salutary effects on the nuclear crisis.

The more Germany shows its ability to engage in creative diplomacy toward Iran, the better the chances of a mutually-satisfactory resolution of this crisis, following the assumption that Iran greatly values its continuous interaction with Germany and other EU countries.

The crucial question at this critical juncture is whether or not trans-Atlantic considerations and US pressure will impede or neutralize the present drift of Germany toward finding its own voice on Iran.

[Rasputin]

The world's major powers are ready to guarantee Iran's right to develop nuclear energy provided Tehran cooperates fully with the UN nuclear safety agency, Russian news agencies quoted Foreign Minister Sergei Lavrov as saying.

"We are prepared to guarantee Iran's right to peaceful nuclear energy on the condition that it answers the questions that the IAEA has raised," Interfax and ITAR-TASS news agencies quoted Lavrov as saying on Monday, referring to the International Atomic Energy Agency.

Lavrov said representatives of the five permanent UN Security Council countries along with Germany were talking this week about formulating a basis for resumption of negotiation with Iran over controls on its nuclear activities.

The United States accuses Iran of pursuing plans to build nuclear weapons under cover of a civilian nuclear energy program which is being developed with Russia's help.

Iran denies this, while Moscow has stressed that Tehran's nuclear work must remain strictly for energy.

"We are ready and mutually interested in drawing Iran into full economic cooperation as well as in cooperation in regional security," Lavrov said as he met in Moscow with the head of the Parliamentary Assembly of the Council of Europe.

Any guarantees to Iran would be contingent on Tehran's full compliance with its obligations under the nuclear Non-Proliferation Treaty and within the guidelines of the IAEA, the Russian minister said.

His comments came at the start of a crucial week of international diplomacy among senior diplomats of the world's leading powers.

The five permanent members of the UN Security Council -- the United States, Britain, China, France and Russia -- will join Germany on Tuesday in a teleconference among political directors of their respective foreign ministries.

They will try work out a package of incentives and dissuasive measures aimed at persuading Iran to renounce some of its most sensitive nuclear work. The six nations' foreign ministers would then meet to finalize that proposal, possibly somewhere in Europe by the end of the week.

As Lavrov spoke, Iran again vowed to press on with uranium enrichment despite international community calls to stop the sensitive nuclear work.

"Enrichment will continue on Iranian territory within the framework of Iran's peaceful nuclear programme and the IAEA," government spokesman Gholam Hossein Elham told reporters in Tehran.

"The information that Iran would quit uranium enrichment on its soil and transfer it to Russia is not correct," he said.

On Sunday Russian National Security Council chief Igor Ivanov and Deputy Foreign Minister Sergei Kislyak held a series of meetings with top Iranian officials led by Ali Larijani, Tehran's top negotiator.

Russia has been offering to produce nuclear fuel on Iran's behalf in order to ease fears Tehran would divert its enrichment programme to making warheads.