Rice warns Iran on nuclear development

( LATWP ) - Secretary of State Condoleezza Rice warned Iran that it would face further punishment and isolation if it forges ahead with efforts to develop a uranium enrichment program, but she said the United States and other world powers are prepared to restart talks aimed at ending the standoff if Iran suspends its most controversial nuclear activities.

The remarks came hours after the International Atomic Energy Agency issued a report claiming Iran has defied yet another U.N. Security Council demand to halt its most sensitive nuclear activities. R. Nicholas Burns, undersecretary for political affairs, will travel to London Monday to press Russia , China , Britain , France and Germany to slap additional penalties against Iran .

``We have the common goal to encourage Iran back to the bargaining table,'' Rice said following a meeting in Berlin with her counterparts from Russia , Germany and the European Union. ``The hope is that the sanctions show the Iranians the isolation that they are enduring, that (the) isolation is likely to increase over time and that it is time to take a different course.''

The IAEA report confirmed that Iran has continued to operate an experimental uranium enrichment program, and that it has advanced its efforts to produce an industrial-scale facility that can potentially produce enough highly enriched uranium to make up to two bombs a year. Iran says it has no intention of producing bomb-grade uranium and will use the facility to produce nuclear fuel for energy.

A senior Iranian official said that the council's demand to suspend its nuclear activities ``could not be accepted by Iran '' because it would strip Tehran of its right, under the 1970 Nuclear Non Proliferation Treaty, to operate a civilian nuclear energy program. ``This report shows that the best way to resolve this international issue is to return to the negotiating table and reach a broad agreement,'' said the official, Mohammad Saeedi, the deputy head of Iran's Atomic Energy Organization, according to Reuters.

Russia , China and several European countries have become increasingly uncomfortable with the Bush administration's positions on Iran as tensions between Tehran and Washington have risen in recent months. Bush recently authorized the U.S. military to capture or kill Iranians intelligence and paramilitary agents in Iraq that the administration has said are involved in attacks against U.S. military forces. The Pentagon has sent two carriers to sit off the Iranian coast in the Persian Gulf , which some allies have interpreted as preparation for a possible military strike.

Those concerns have prompted renewed calls for direct dialogue with Iran . German, Swiss, Russian, Chinese, Saudi and IAEA officials have all reached out to Iran in recent weeks in the hopes of restarting talks even if Iran continues to defy the Security Council.

Several diplomats said there was a possibility that the E.U.'s top diplomat, Javier Solana, would meet next with Iranian negotiator Ali Larijani to come up with a list of guiding principles for future negotiations.

U.S and European diplomats said that they are pursuing a ``dual track'' diplomatic strategy--pressing simultaneously for additional sanctions and renewed negotiations with Tehran --but remained divided over how tough a new sanctions should be.

The United States, Britain and France favor imposing a series of additional penalties against Iran, including a mandatory travel ban and additional asset freezes against some Iranian officials linked to the country's most sensitive nuclear programs. They also support measures a ban on export credits. ``We want to do it as soon as possible and to avoid the wrangling of last time. But we've got to get tougher sanctions than we have at the moment if we want real impact and we're very realistic about how difficult that may be,'' a senior European official said.

A senior U.S. official said the United States is willing to forgo a tough resolution in exchange for the Security Council moving quickly unity on an agreement to raise the political stakes for Iran while avoiding a fight with the Russians.

But other European powers that conduct billions of dollars in trade with Iran --including Germany and Italy --have resisted the imposition of stringent economic sanctions that would harm their commercial interests.

Russia and China are also resisting a tough reaction. Russia 's U.N. ambassador, Vitaly Churkin said, ``We should not lose sight of the goal (which) ... is to accomplish a political outcome of this problem.''

Thursday's six-page report concluded that that `` Iran has not suspended its enrichment related activities.'' The report provided no evidence that Iran is trying to develop nuclear weapons, as President Bush asserts, but inspectors said Iran 's lack of voluntary cooperation with its investigation made it impossible to rule out that such efforts were underway.

The report detailed progress Iran has made in the last two months installing several hundred centrifuges for industrial-scale enrichment at its largest nuclear facility in the town of Natanz . The Iranians have been enriching low levels of uranium suitable for a nuclear energy program, not bombs, in other centrifuges set up over a year ago at Natanz's research center.

Agency inspectors said Iran had not provided any new information on the history of its nuclear program, which began in secret in 1987. Inspectors also received no answers to questions raised in documents obtained by U.S. intelligence in 2004 which suggest that Iran was trying to develop a missile capable of carrying a nuclear warhead and was considering plans for a second uranium-conversion facility.

Despite the lack of information in the report, no official, in Washington or Europe, suggested that Iran 's current work meant it will acquire nuclear weapons in the near future.

``Their nuclear program is not forging ahead,'' said a senior European diplomat. ``Some of that is a result of the sanctions and the international pressure on them and some of it is because of their own technical difficulties in putting the program together.''

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