Iran Claims New Proposals Will End Nuclear Row With the Us and Europe

President Mahmoud Ahmadinejad of Iran today claimed to have drawn up a package of proposals to end the stand-off with the US and Europe over Tehran's alleged nuclear weapons ambitions.

The US, in response, said it would study any proposals and expressed hope that they would address the international community's concerns.

The comments from both side reflect the growing chance of a rapprochement between the long-term enemies since Barack Obama began making overtures in January towards the state that had been branded part of the "axis of evil" by former president George Bush.

Iran and the US are expected to meet face to face soon for the first talks on the nuclear issue.

Ahmadinejad, in a speech in the south-eastern province of Kerman, broadcast on state-run television, said: "We have prepared a package that can be the basis to resolve Iran's nuclear problem. It will be offered to the west soon. This new package will ensure peace and justice for the world. It respects rights of all nations."

US and European officials urged caution, as similar pronouncements by Iranian leaders in the last few years in the end amounted to little more than rhetoric. But Ahmadinejad may be ready to go further this time because of domestic pressure. Obama's overtures have apparently gone down well with parts of the Iranian public, and he faces an election this summer. The prospect of a deal has been increased by the willingness of Obama to drop Bush's precondition for talks with Iran. Negotiations could begin without it first suspending uranium enrichment.

Iran may be preparing a compromise in which it will continue with uranium enrichment, but allow the UN watchdog, the International Atomic Energy Agency, to make more intrusive and surprise inspections to ensure it is not building a nuclear weapon. Another possible compromise, first put forward by Moscow, would be for Russia to supply Iran with enriched uranium, while retaining control over the enriched uranium.

Tehran claims its nuclear program is only for civilian purposes - to produce electricity.

Iran and the US may eventually have to settle for a fudge that would see Tehran mastering the technology needed to make a nuclear weapon but not making it. The Obama administration might reluctantly accept that, but the Israeli government, which is threatening an air strike against Iran's nuclear plants, may not.

A US state department spokesman, Robert Wood, responding to Ahmadinejad's promise of new proposals, said: "If they come up with some new package with regard to their nuclear program, we'll take a look and see what it is. Our hope will be that it addresses all of the concerns that the US and other countries have."

An Iranian official told Reuters today that suspension of uranium enrichment was out of the question, but Iran might agree to increased IAEA scrutiny.