Iran less than anxious at restive nuclear watchdogs

Gareth Smyth, The Financial Times:

When Mahmoud Ahmadi-Nejad, Iran's fundamentalist president, recently met other senior leaders in Tehran, he suggested they should not worry unduly about growing western pressure.

UN sanctions - which could follow if Iran's nuclear file is soon referred to the Security Council - were "not important," he said. "That's the way the fundamentalists think," said a regime insider familiar with the meeting.

Since taking over in August, Mr Ahmadi-Nejad and his new officials have faced an escalation in the international dispute about Iran's nuclear programme.

European governments last month backed the US in persuading the governing board of the International Atomic Energy Agency to find Iran in "non-compliance" with the Nuclear Non-Proliferation treaty, so paving the way for referral to the Security Council in November.

Since then, Tehran has rejected the IAEA board's request for greater "transparency" - including inspectors' access to individuals and documents - and dismissed its calls to end the conversion of raw uranium into gas; an early phase in the sensitive uranium-enrichment process, which it resumed in August as two-year talks with the Europeans stalled.

Some Iranian officials are privately expressing concern about the conduct of diplomacy since the president replaced many experienced officials, including those handling the nuclear dispute. The speech he delivered at the UN summit in August was applauded at home but dismissed as confrontational by European officials.

While Mr Ahmadi-Nejad faces little immediate domestic pressure to moderate his stance, some politicians are beginning to question both his strategy and competence.

Last Friday, Akbar Hashemi Rafsanjani, the powerful former president whom Mr Ahmadi-Nejad defeated in June's election, warned the west against "intimidation", but also cautioned Iran against "sloganeering".

Mohammad Atrianfar, editor of Shargh, the reformist newspaper, has argued not all countries should expect to enrich uranium, and Hossein Abdeh-Tabrizi, secretary general of the Tehran

Stock Exchange, has linked falling stock prices to the nuclear issue.

But Mr Ahmadi-Nejad may be taking advice elsewhere. Among the senior clerics he visited last week in the holy city of Qom was Ayatollah Mohammad-Taghi Mesbah-Yazdi, dubbed the "spiritual father" of the fundamentalists and an advocate of isolation from the west.

The sense Iran is under attack is shared by many of Mr Ahmadi-Nejad's new cabinet, half of whom have a military background. "Their outlook is not the win-win of diplomats, but the zero-sum of the battlefield," said an analyst. READ MORE

"It's a complicated deadlock - not for the first time in Iran - but what's new is that Mr Ahmadi-Nejad and his team are not too unhappy about it," said the regime insider. "They will continue [in defiance] until their heads hit the stone. Then they will give way, but it's hard for them or anyone else to predict the critical point. And that's what's so dangerous."

The fundamentalists' confidence comes partly from Iran's likely resilience against sanctions.

As Opec's second-largest producer, due to receive $36bn this year from sales, Iran is buoyed by high oil prices and does not expect exports to be curbed. The country is largely self-sufficient in food, and neighbours have porous borders. Foreign investment, outside energy, is already limited.

Moreover, Mr Ahmadi-Nejad remains popular at home after his landslide election victory. His cabinet's first decision set up a "compassion fund", freeing the equivalent of $1.3bn from oil income for a scheme to help young people find jobs, homes and a marriage partner.

The fundamentalists also argue that the outside world, and not Iran, is to blame for the nuclear confrontation. Two years of negotiations with the Europeans produced no tangible benefits, they say. According to the regime insider, former officials in charge of the nuclear file argued that the Europeans would eventually make concessions, including allowing Iran to keep a pilot enrichment plant. "But it seems the Europeans did not accept and so the talks with them ended. We're now on a different road, heading in another direction," he said.