Iran Will Smile On The Nuclear Issue Till A Deal With USA Ends The Atomic Option.

TEHRAN - Iran's first nuclear reactor, a 1,000 MW plant at Bushehr which Tehran says is being built as a power station, should be operational in 2005. Iran's next president, to be elected in 2005, will have to resolve a potentially-explosive dispute between Tehran and Washington over the nuclear issue, with the US insisting that the Shiite theocracy is developing atomic bombs rather than nuclear energy. A highly-placed APS source here says the next government, under the new president, will keep a fairly friendly relationship with the International Atomic Energy Agency (IAEA) but, at the same time, will drive a hard bargain with the US.

The bargain will involve several matters of strategic importance to both parties, including Iraq and the nuclear issue. The next government, while it will do all it can to avert a serious confrontation with the US, will have a tough stand until, eventually, this set of major trade-offs is realised: Iran will forego the nuclear option in return for an alliance between the US and the Shiite world. But the road to that objective will be long and will pass through Iraq (see surveys of Iraq being serialised in the FAP and OOD monthlies).

Reformist President Mohammad Khatami, whose second and final term ends in 2005, is most likely to be succeeded by a conservative figure. The reformists have lost power since the parliamentary elections of Feb. 20, 2004, when conservatives won a big majority. Most reformist candidates had been barred from running for parliament in a power struggle won by the conservative camp. While reformists favoured dialogue with the US and a moderate stand on the nuclear issue, the conservatives called for a hard line on this issue but were quietly indicating that they were the ones in a position to negotiate a lasting deal with the Americans.

Former president Ali Akbar Hashemi Rafsanjani, who heads the Expediency Council that mediates among the various factions of the theocracy, will guide the Iranian negotiators with the US. He will do that in his capacity as chairman of a body in charge of decisions pertaining to Iran's strategic interests and national security. The APS source points out that the person who will be elected president in 2005 will be a figurehead for Rafsanjani and for those conservative leaders who believe that, ultimately, Iran should have a ruling structure better than a theocracy.

For the time being, however, Tehran has resumed the building of centrifuges for its nuclear programme. A Tehran announcement to that effect made last month marked a major setback in international attempts to resolve the standoff with Iran over the issue.

IAEA head Mohammed ElBaradei last month said he hoped that this decision was of a temporary nature, adding: "I hope it will be reversed... Iran needs to do the maximum to build confidence after a period of confidence deficit". White House spokesman Scott McClellan said: "Iran needs to come clean and fully cooperate with its international obligations".

Iran had suspended the building of centrifuges, along with the enrichment of uranium, amid international pressure and attempts by ElBaradei's agency to determine whether the programme was aimed at producing weapons, as the US contends, or was for peaceful purposes. Tehran reversed the suspension after the agency approved a European-drafted resolution that rebuked Iran for past cover-ups in its nuclear programme. (The centrifuges can be used to purify uranium to fuel atomic power plants, or to produce nuclear weapons).

Iranian Foreign Ministry Spokesman Hamid Reza Asefi last month invited the IAEA to monitor the centrifuge construction. He said, however, that Iran would remain committed to the suspension of actual uranium enrichment - injecting gas into centrifuges.

(Uranium, in its natural form, contains too low a concentration of fissionable isotopes to be used as fuel for reactors or weapons material and must be put through an enrichment process. Tehran says Iran needs nuclear energy to meet booming demand for electricity and keep oil and gas reserves for export).

According to the Institute for Science and International Security, a non-partisan Washington-based think-tank, new satellite images show buildings at the site at Lavizan-Shian in north-eastern Tehran were dismantled, rubble carted away, and the ground around it scraped. At other sites, IAEA inspectors have found traces of enriched uranium using sophisticated environmental sampling. This has led Iran to revise declarations to the IAEA.

New Iran-Russia Nuclear Deal: Alexander Rumyantsev, head of Russia's Atomic Energy Agency, on June 22 said Moscow and Tehran would soon sign an agreement in the Iranian capital to return spent fuel from the Bushehr nuclear reactor to Moscow, ending years of talks. (The US has pressured Moscow to stop the construction of the Bushehr plant).

Rumyantsev said: "During this [summer's visit to Tehran] we plan to sign an additional protocol on the return of spent nuclear fuel to Russia for storage and processing". The document must be signed before the end of the summer if Bushehr's first 1,000 MW reactor is to go on-stream in 2005. The plant was originally supposed to start up in 2003.

Once the protocol is signed, Russia will ship fuel to Iran to start up the reactor. Spent fuel will be sent back to a giant storage facility in Siberia after roughly a decade of use.

An official from a nuclear fuel plant in Siberia was last month quoted as saying that up to 168 nuclear fuel units would be immediately dispatched to Bushehr after the signing to start up the reactor. A further 43 would be shipped each year thereafter to keep it going.

Signature of the document has been delayed repeatedly, with industry insiders saying disagreement over technical matters and the row with the US nearly prompted both sides to abandon the project this year. Rumyantsev told Tass only that delays were linked to "failure to fulfill certain contract obligations by some Russian and Iranian firms".

On June 28, the Russian government and the IAEA agreed that Iran must take further steps to regain the trust of the international community. Speaking to reporters after meeting Russian Foreign Minister Sergei Lavrov in Moscow, ElBaradei said they wanted Iran to do more to convince the world that its nuclear ambitions were peaceful.

ElBaradei added: "We talked at length about Iran and the importance of us clarifying all outstanding issues [about its nuclear programme] and Iran providing co-operation, but also the importance of Iran trying to [build] confidence. The more confidence-building we can get from Iran the better for Iran and everybody else".

Tehran last month made it known that, by reversing its centrifuge decision, it was merely retaliating against an IAEA board of governors resolution that rebuked Iran for not fully co-operating with the UN body.

ElBaradei said of the board's move: "These are a set of measures [to which] Iran has committed itself on a voluntary basis to build confidence after confidence (was) shattered". He said confidence in Iran had been jolted by revelations that Tehran had kept its uranium enrichment programme a secret for nearly two decades before acknowledging it last year.

IAEA's Differing Approach To Israel Nuclear Programme: While visiting Israel, ElBaradei on July 8 said that differing approaches to the nuclear policies of Israel and Iran were damaging the credibility of efforts to rid the Middle East of nuclear weapons. The same point has been made by Iran and the Arab world.

ElBaradei said there was a "security imbalance" across the Middle East and a perception that Israel was treated differently from other countries in the region when it came to nuclear programmes and the possession of nuclear weapons.

(ElBaradei was seeking to persuade Israel to sign up to the IAEA's goal of declaring the Middle East a nuclear weapons-free zone. He said PM Ariel Sharon told him Israel supported the goal, but only as part of the stalled "road map" for peace in the region. Israel neither denies nor admits possessing nuclear weapons and has refused to sign the nuclear non-proliferation treaty, so it need not allow international inspections of its nuclear programme. Its non-co-operation has led to strained relations with the IAEA. Iran, in contrast, has signed the treaty and is under intense EU and US pressure to reveal the extent of its nuclear programme. ElBaradei said the resulting "security imbalance" in the Middle East was leading to "the complete erosion of the legitimacy of the non-proliferation regime").