UPDATE 2-Iran's Rouhani to pack cabinet with old hands

Mon Jul 29, 2013 7:46am EDT

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DUBAI, July 29 (Reuters) - Iranian President-elect Hassan Rouhani will pick a cabinet of experienced insiders and will appoint the head of a powerful charity-cum-business foundation as his chief nuclear negotiator, Iranian news agencies said on Monday.

Rouhani, who was elected last month and will be inaugurated on Aug. 4, has pledged a less abrasive stance in nuclear talks with world powers than outgoing President Mahmoud Ahmadinejad, who offended many in the West by denying the Holocaust and calling for Israel to be erased "from the page of time".

The ISNA and Mehr news agencies said Rouhani would nominate Mohammad Forouzandeh as head of the Supreme National Security Council, effectively making him Iran's chief nuclear negotiator.

The moderate cleric will also bring former Oil Minister Bijan Zanganeh back to his old job and name former U.N. envoy Mohammad Javad Zarif as foreign minister, the agencies said.

There was no immediate official confirmation of the reported nominees for top posts. Parliament must approve all the president's ministerial choices.

Forouzandeh, tipped to head Iran's nuclear negotiating team, is a former Revolutionary Guard, a former defence minister and now a member of Iran's Security Council.

He also heads the Foundation for the Oppressed and Disabled, the biggest of the state charitable organisations which dominate large parts of the economy. It controls companies involved in petrochemicals, shipping, construction and a host of other enterprises and employs tens of thousands of people.

Occupying such a key position implies that Forouzandeh has the backing of Supreme Leader Ayatollah Khamenei, a conservative cleric who is at the apex of Iran's complex power structure.

Media speculation about Rouhani's planned appointments has also linked Forouzandeh to the position of first vice president.

CROSS-PARTY CABINET

The United Nations, the United States and the European Union have imposed repeated rounds of sanctions on Iran for failing to comply fully with U.N. resolutions over its nuclear programme which Western states see as aimed at atomic weapons capability.

Iran denies it wants to make nuclear arms, saying its programme is only for medical research and power generation.

Rouhani has said he will include reformists and hardline conservatives in his government and appoint ministers according to their ability rather than their political background.

Ahmadinejad, who steps down on Sunday, was heavily criticised in Iran for appointing political allies to key posts and mismanaging an economy already struggling with sanctions.

Zanganeh, Rouhani's reported choice as oil minister, would be returning to a job he held under Iran's reformist government from 1997 until 2005, when Ahmadinejad took office.

Zanganeh helped attract billions of dollars of foreign investment into Iran's oil and gas industry, and was seen as enjoying Khamenei's support.

"He's a good communicator and respected within OPEC," said a Gulf OPEC delegate. "This is good news in terms of oil prices and market stability."

Since Zanganeh was last in office, Iran's crucial oil and gas industry has been hit hard by U.S. and EU sanctions on the energy sector, shipping and financial transactions.

These have cut Iran's oil exports by about a half since last year, helped devalue the currency and pushed up inflation.

Zarif, the prospective foreign minister, served as Iran's ambassador to the United Nations from 2002 to 2007.

Under reformist President Mohammad Khatami, he was involved in the early stages of talks over Iran's nuclear programme at a time when Rouhani was Tehran's chief negotiator. (Reporting by Marcus George and Peg Mackey; Writing by Jon Hemming; Editing by Alistair Lyon)

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