Iran hints at nuclear concessions, next talks set for Nov 7-8

Reuters

* Iran suggests ready to curb sensitive uranium enrichment

* Hints could eventually allow wider U.N. inspections

* Next meeting in 3 weeks to flesh out proposal details

* Talks with Iran extraordinarily "straightforward" - U.S.

* Moderate Iran president opened door to serious talks

* Ten-year-long standoff has raised risk of Middle East war

By Louis Charbonneau and Yeganeh Torbati

GENEVA, Oct 16 (Reuters) - Iran appears ready to scale backactivity of potential use in making nuclear bombs, suggesting itis willing to compromise for a deal to win relief from harsheconomic sanctions, diplomats said on Wednesday, and follow-uptalks will be held on Nov. 7-8.

In a rare joint statement highlighting the dramatic shiftfrom confrontation to dialogue since a moderate Iranianpresident took office in August, chief negotiators from Iran andsix world powers said Tehran's new proposal aimed at defusinglongstanding suspicions over the nature of its nuclear programmewas an "important contribution" now under careful consideration.

Details of Iran's proposals, presented during two days ofnuclear negotiations in Geneva with the powers, have not beenreleased, and Western officials were unsure whether Tehran wasprepared to go far enough to clinch a breakthrough deal.

In a clear sign of hope, however, European Union foreignpolicy chief Catherine Ashton said it was agreed to hold thenext round of negotiations in three weeks in Geneva, and Iran'schief negotiator praised this week's meetings as "fruitful".

Diplomatic paralysis and talk of war reigned during theeight-year tenure of Iranian President Mahmoud Ahmadinejad, abellicose hardliner. But the door to serious talks opened inJune with the landslide election of Hassan Rouhani on a platformof conciliation to ease Iran's international isolation.

Iran and the United States, Russia, China, France, Britainand Germany began negotiations in earnest on Tuesday to defusethe increasingly volatile stand-off shadowing the Middle East.

The powers want the Islamic Republic to stop higher-gradeuranium enrichment to allay concerns that it would provide Irana quick path to bomb-grade nuclear fuel. Iran says it isrefining uranium only to generate more electricity for a rapidlyexpanding population and to produce isotopes for medicine.

The joint statement, read out by Ashton, said Iran's foreignminister "presented an outline of a plan as a proposed basis fornegotiation" and said the talks were "substantive and forwardlooking," without elaborating.

Ashton, presiding over the talks on behalf of the powers,told a closing news conference that the discussions were "themost detailed we have ever had, by, I would say, a long way." The two sides had agreed that nuclear and sanctions expertswould convene before the next high-level negotiations.

Iranian Foreign Minister and chief negotiator Mohammad JavadZarif said Tehran looked to a new era in diplomatic relations."We sense that members of the (six powers) also have exhibitedthe necessary political will in order to move the processforward. Now we need to get to the details," he told reporters.

"DETAILED, STRAIGHTFORWARD TALKS"

A senior U.S. administration official enthused over thesubstantive quality of the talks. "I've been doing this now forabout two years," the official said on condition of anonymity."And I have never had such intense, detailed, straightforward,candid conversations with the Iranian delegation before."

The official added: "Although there remain many differencesin each area, and what sanctions relief might be appropriate,specific and candid discussions took place."

After Tuesday's initial round, Iranian Deputy ForeignMinister Abbas Araqchi suggested Tehran was prepared to addresslong-standing calls for the U.N. nuclear watchdog to have widerand more intrusive inspection powers.

He also told the official IRNA news agency that measuresrelated to its uranium enrichment were part of the Iranianproposal, but hinted the Islamic Republic was not inclined tomake its concessions quickly.

"Neither of these issues are within the first step (of theIranian proposal) but form part of our last steps," he saidwithout elaborating, in comments reported on Wednesday.

The sequencing of any concessions by Iran and any sanctionsrelief by the West could prove a stumbling block en route to alandmark, verifiable deal. Western officials have repeatedlysaid that Iran must suspend enriching uranium to 20 percentfissile purity, their main worry, before sanctions are eased.

Britain said it hoped this week's talks would lead to"concrete" results but that Iran must take the initiative."Iran will need to take the necessary first steps on itsprogramme and we are ready to take proportionate steps inreturn," Foreign Secretary William Hague said in a statement.

Russia warned against undue optimism after the Oct. 15-16talks. "The result is better than in Almaty (talks held inApril) but does not guarantee further progress," Sergey Ryabkov,Russia's deputy foreign minister and Iran negotiator, toldInterfax. "There could have been better cooperation."

Israel, Iran's arch-foe, had urged the powers to be tough inthe talks by demanding a total shutdown of enrichment and rulingout any early relaxation of sanctions. But it did not repeatveiled threats to bomb Iran if it deems diplomacy pointless.

HESITATION

Western diplomats were hesitant to divulge specifics aboutthe negotiations due to sensitivities involved - both in Tehran,where conservative hardliners are sceptical about striking dealsthat could curtail the nuclear programme, and in Washington,where hawks are reluctant to support swift sanctions relief.

But Iran, diplomats said, has made much more concreteproposals than in the past, when ideological lectures andobfuscations by Tehran were the norm, to the point that Iraniannegotiators were worried about details being aired in publicbefore they had had a chance to sell them back in Tehran.

Zarif said earlier in a post on Facebook that secrecy wasworking in the negotiators' favour. "Normally, the lessnegotiators leak news, the more it shows the seriousness of thenegotiations and the possibility of reaching an agreement."

Diplomats said other proposals Iranian envoys had maderegarding eventual "confidence-building" steps included halting20 percent enrichment and possibly converting at least some ofexisting 20 percent stockpiles - material that alarms the powersas it is only a short technical step away from weapons-grade -to uranium oxide suitable for processing into reactor fuel.

COMPLETE HALT TO ENRICHMENT OUT OF QUESTION

But Iran did not intend to renounce all enrichment itself"under any circumstances", the Russian state news agency RIAquoted an unidentified Iranian delegation source as saying.

He was dismissing the maximal demand of U.S. and Israelihawks which Western diplomats concede would undermine Rouhani'sauthority at home by exposing him to accusations of a sell-outfrom conservative hardliners in the clerical and security elite.

Most Iranians of whatever political persuasion equate thequest for nuclear energy with national sovereignty,modernisation and a standing equal to the Western world.

"Apart from suspending 20 percent enrichment, it is possibleto consider a scenario involving reducing the number ofcentrifuges (enriching uranium)," RIA quoted the delegate assaying. "However, for this, concrete steps from our opponentsare required, which we do not see yet."

Iran has sharply expanded its uranium enrichment capacity inrecent years and it now has roughly 19,000 installed suchmachines. Of those, about 10,400 are currently enriching.

The fact that Iran has so many idle centrifuges potentiallyallows it to swiftly expand enrichment, if it wanted, or to usethem as a bargaining chip in negotiations with the powers.

Rouhani's election in June turned Western pessimism intoguarded optimism that Iran might be ready to do a deal beforetensions escalated uncontrollably into armed conflict.

The sprawling Shi'ite state of 75 million people has becomeanxious to be rid of Western-led sanctions that have impairedits economy, slashed its critical oil export revenues by 60percent and brought about a devaluation of its rial currency.

Iran has previously spurned Western demands that it shelve20 percent enrichment as an initial step in return for modestsanctions relief encompassing, for example, imported aircraftparts. Instead, it has called for the most far-flung and painfulsanctions, targeting oil and banking sectors, to be rescinded.

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