Britain says China won't risk isolation over Iran

* Iran will be high on Miliband's agenda

* Miliband to warn of dangers of protectionism

By Jim Drury

LONDON, March 12 (Reuters) - Britain's ambassador to China said on Friday that Beijing risks isolation if it fails to join international efforts to impose sanctions on Iran over its nuclear programme.

Speaking via videolink from Beijing before a visit to the country by Foreign Secretary David Miliband, Sebastian Wood told a London briefing that Britain and China shared the same goals in preventing Iran from acquiring nuclear weapons.

"It's not in China's interests to find itself isolated from permanent members of the Security Council or the E3+3. It would damage China internationally," he said.

Iran's recent announcement that it would further expand its nuclear programme has increased pressure from the United States and the E3+3 for tougher sanctions on Tehran.

The E3+3 was established specifically to deal with Iran's disputed nuclear programme and consists of the five permanent Security Council members -- the United States, China, Russia, France and Britain -- plus Germany.

Tehran rejects Western charges that its nuclear programme is aimed at developing bombs and says it will only be used to generate electricity.

Wood said China shared Britain's desire to prevent Iran becoming a nuclear power, but accepted the two countries favoured different approaches to resolve the issue.

"China has emphasised a need for engagement and diplomacy and wants to see the situation resolved soon. We have seen tactical differences in recent weeks but it's a fluid discussion. China has a lot to lose with nuclear proliferation in an unstable region," he said.

GULF STATES

U.S. Defense Secretary Robert Gates said on Thursday that leading Gulf states appeared ready to use their clout to lobby China to support sanctions against Iran.

Gates travelled to the United Arab Emirates to discuss sanctions against Iran with Abu Dhabi's Crown Prince Sheikh Mohammed bin Zayed al-Nahayan.

Asked after the talks whether his hosts were ready to help the United States overcome Chinese and Russian doubts on sanctions, Gates said:

"I have a sense that there is a willingness to do that. Although there is less need with respect to Russia, because I think Russia is pretty much already there. It's mainly China."

Miliband will hold talks with both his Chinese counterpart Yang Jiechi and Premier Wen Jiabao during his three-day trip, which begins on Sunday.

Iran will be high on the foreign secretary's agenda, Wood said.

A Western proposal for a fourth set of sanctions against Iran over its nuclear programme is under discussion at the United Nations.

Russia has indicated it could back new sanctions, but China has argued that sanctions might make a diplomatic solution difficult.

On Monday Miliband will use a speech in Shanghai to warn his hosts on the dangers of economic protectionism.

"There is a significant threat of protectionism in the world economy. It's in China's interests to be more economically open as it becomes more prosperous," said Wood.