Indian Prime Minister Manmohan Singh has said he hopes the Iran nuclear dispute can be resolved without being taken up by the UN Security Council.
Mr Singh says national interest will decide vote on Iran
The UN's nuclear body is due to vote on Thursday on the key step of reporting Iran to the Security Council over its nuclear plans.
Mr Singh told journalists he hoped "diplomacy and dialogue" would prevail.
Last week the US envoy to India said a key nuclear deal between the countries hinged on how India voted on Iran.
The Vienna-based IAEA will consider a resolution agreed by the five permanent Security Council members plus Germany.
Mr Singh told reporters on Wednesday that he was hopeful of a consensus at the IAEA meeting.
"This is a matter which should be resolved through diplomacy and dialogue... we would very much like that this matter be resolved within the IAEA," Mr Singh said.
Mr Singh also said that how India voted at the IAEA meeting will depend on the text of the draft resolution and keeping India's national interest in mind.
India has recently signed a key nuclear pact with the US
US ambassador to India, David Mulford, came under severe criticism when he commented that a landmark nuclear deal between the two countries could "die" in the US Congress if India does not vote to refer Iran to the UN.
Later, Mr Mulford said his comments were taken out of context and that he was only referring to the anti-Iran feelings in the US Congress.
India has recently signed a pact with the US which would allow it to import nuclear fuel from the US for its civilian programmes.
Following Mr Mulford's comments, the communist parties in India - a key partner in the Congress party-led ruling alliance - criticised the government of siding with the US to save the key nuclear pact rather than supporting an old ally.
India has been a long-standing ally of Iran and has recently agreed on a gas pipeline deal with Iran to meet India's growing energy needs.
Reacting to the criticism Mr Singh said, "There is no question of bending... But we are also very keen to have strategic nuclear cooperation so that our energy security can get an added edge."
Last September when another IAEA resolution was passed, which could have referred Iran's nuclear programme to the UN, India had sided with the US and European powers.
Western powers fear that Iran is developing its nuclear programme to build weapons.
Iran has always denied this and said that nuclear power will be used only for civilian purposes. Iran is also a signatory to the Nuclear Non-proliferation Treaty (NPT).