West wary as Iran president agrees nuclear deal terms

Iran's nuclear programme has alarmed Western powers

The US and key allies have called on Iran to match its words with actions after it appeared to accept a deal to swap enriched uranium for nuclear fuel.

President Mahmoud Ahmadinejad said Iran would have "no problem" if most of its stock was held for several months before being returned as fuel rods.

The US said that if this was a new offer, it was "prepared to listen".

Germany's foreign minister said "only actions" counted and his French counterpart said he was "perplexed".

Soon after the Iranian statement, state TV announced the successful launch of a satellite rocket carrying an "experimental capsule".

The White House described the rocket launch as "a provocative act".

"But the president believes that it is not too late for Iran to do the right thing - come to the table with the international community and live up to its international obligations", White House spokesman Bill Burton was quoted as saying by Reuters news agency.

The West is concerned about Iran's growing missile technology and possible links to its nuclear programme.

Iran insists its nuclear development and rocket programme are entirely peaceful.

ANALYSIS Paul Reynolds, BBC world affairs correspondent If President Ahmadinejad's comments are followed up by an Iranian approach to the IAEA stating that it is ready to negotiate on a uranium deal, then the whole picture would be changed. Up to this point, Iran has said that it wants major changes to the proposed deal, which would make it unacceptable to the US and its allies. If, on the other hand, he is saying this now as a way of undermining the current discussions on increasing sanctions on Iran, there would be no progress. As always with Iran, it is difficult to assess its policy from one statement. But at least there is some hope.

A deal struck in October between Iran, the International Atomic Energy Agency (IAEA) and the so-called P5+1 - the US, Russia, China, UK, France plus Germany - envisaged Iran sending about 70% of its low-enriched uranium to Russia and France where it would be processed into fuel for a research reactor.

But last month, diplomats said Iran had told the IAEA that it did not accept the terms of the deal and had instead demanded a simultaneous exchange on its territory.

Then, in a state TV interview on Tuesday, President Ahmadinejad dismissed the concerns of his "colleagues" that the West would retain the uranium.

"We have no problem sending our enriched uranium abroad," he said.

"We say, 'We will give you our 3.5% enriched uranium,' and will get the fuel. It may take four to five months until we get the fuel."

BBC Tehran correspondent Jon Leyne, reporting from London, says there will still be scepticism about whether President Ahmadinejad's offer is anything more than a delaying tactic designed to fend off fresh sanctions.

'A bit pessimistic'

A White House official told the BBC: "If Mr Ahmadinejad's comments reflect an updated Iranian position, we look forward to Iran informing the IAEA."

NUCLEAR FUEL CYCLE Mined uranium ore is purified and reconstituted into solid form known as yellowcake Yellowcake is chemically processed and converted into Uranium Hexafluoride gas Gas is fed through centrifuges, where its isotopes separate and process is repeated until uranium is enriched Low-level enriched uranium is used for nuclear fuel Highly enriched uranium can be used in nuclear weapons In depth: Nuclear fuel cycle Iran launches satellite rocket

The official added: "If Iran has something new to say, we are prepared to listen."

The British Foreign Office also said that it "looked forward" to Tehran notifying the IAEA.

A spokesman at the IAEA in Vienna told AFP news agency it had nothing to add to its earlier statements.

Moscow gave a guarded response to the Iranian offer, with Russian Foreign Minister Sergei Lavrov saying it would welcome Iran's return to the scheme

But the French Foreign Minister, Bernard Kouchner, suggested the Iranians were stalling and said he was "perplexed and even a bit pessimistic" about Tehran's offer.

German Foreign Minister Guido Westerwelle told reporters that Iran had to be "measured by its actions, not by what it says" and that it was up to Iran to "show an end to its refusal to negotiate".

Mr Ahmadinejad also said there were negotiations about a possible prisoner swap for several Iranians jailed in the US for the three American hikers currently being held in Iran.

"There are some talks under way to have an exchange, if it is possible," he said. "We are hopeful that all prisoners will be released."

Mr Ahmadinejad did not go into detail, but in December Tehran released a list of 11 Iranians it says are being held in US prisons, including a nuclear scientist who disappeared in Saudi Arabia and a former defence ministry official who vanished in Turkey.

The US has denied any knowledge of their whereabouts.