* Powers float new proposal to curb uranium enrichment
* Two sides give positive signals as Baghdad talks begin
* Iran says pressure is futile but hopes for "good news"
* Russia: Iran hinting at concessions if sanctions relaxed
(Adds confirmation of second day talks)
By Justyna Pawlak and Patrick Markey
BAGHDAD, May 23 Iran and world powers exchanged
unusually detailed proposals at talks in Baghdad on Wednesday in
hopes of defusing a long standoff over suspicions Tehran's
atomic energy programme may be a disguised quest for nuclear
The stakes could hardly be higher: global oil markets are
jittery over extended Western sanctions imposed on Iran's vital
crude exports and the spectre of a Middle East war arising from
possible Israeli strikes against its defiant arch-enemy.
But no breakthrough appeared to be in the offing in Baghdad,
where the six powers were testing Iran's willingness to curb its
uranium enrichment work. Differences remained, notably, over
when Iran would be rewarded with relief from economic sanctions.
A Western official said the discussions would resume on
Thursday. He was speaking after Iranian chief negotiator Saeed
Jalili and European Union foreign policy chief Catherine Ashton
held a bilateral meeting that went on late into the evening.
Earlier on Wednesday, envoys for Iran and the United States,
Russia, China, France, Britain and Germany convened in a plenary
session with both sides publicly upbeat about the scope for an
outline deal following a 15-month diplomatic freeze and
exploratory talks in Istanbul last month.
"We had a detailed exchange this morning," said a Western
diplomat who spoke of the six powers presenting a 'package' of
proposals in the morning. "The atmosphere was businesslike."
In the afternoon, another diplomat said, Iran reacted to the
offers and "also broadened out the discussions to touch on other
areas we see as non-core issues".
Iranian media close to the Tehran government said its chief
negotiator Saeed Jalili presented its own five-point package of
proposals covering a "comprehensive" range of nuclear and
The official news agency IRNA sounded a note of discord by
quoting Iranian officials as referring to the big-power proposal
as "nitpicking" while student news agency ISNA said: "Apparently
from the Iranian point of view this package is not balanced."
However, those leaks did not appear to be Tehran's final
response as the talks ran on into the evening.
The powers' overall goal is an Iranian agreement to curb
uranium enrichment in a transparent, verifiable way to ensure it
is for peaceful purposes only. Iran's priority is to secure an
end to sanctions isolating the country and damaging its economy.
The pivotal proposal by the six, led by Ashton, was for Iran
to halt its enrichment of uranium to the higher fissile
concentration of 20 percent, her spokesman Michael Mann said as
talks got under way.
That is the Iranian nuclear advance most worrying to the
West since it largely overcomes technical obstacles to reaching
90-percent, or bomb-grade, enrichment. Iran says it is enhancing
the fissile purity to such a degree only for medical research.
"We have a new offer on the table which addresses our main
concerns about the Iranian nuclear programme. The 20-percent
enrichment question," Mann told reporters. "We hope the Iranians
respond positively and we can make progress today."
In a separate interview with Iran's state-run
English-language Press TV, Mann said no final deal was expected
in Baghdad because progress was likely to be only gradual.
He said toughened sanctions, especially an EU ban on Iranian
oil exports due to take full effect on July 1, had helped to
draw Iran finally into serious negotiations.
Iran has hinted at flexibility on higher-grade enrichment
although analysts caution that it would be unlikely to
compromise much while sanctions remain in place.
In previous meetings the two sides could not even agree an
agenda, with each largely repeating known positions and Tehran
refusing any dialogue on changes to its nuclear path.
IRAN HOPES FOR "GOOD NEWS" SOON
Iranian Foreign Minister Ali Akbar Salehi, speaking to
reporters in Tehran, said: "The ideas fielded to us speak of the
fact that the other side would like to make Baghdad a success.
We hope that in a day or two we can bring good news."
Salehi also warned that Iran would not bow to pressure:
"Their policies of pressure and intimidation are futile. They
have to adopt policies to show goodwill to solve this issue."
Russia said the Islamic Republic appeared ready for serious
discussion of substantive steps to resolve the impasse in return
for the phased removal of sanctions.
Speaking of preparatory discussions before Baghdad, Foreign
Minister Sergei Lavrov said in Moscow: "We got the clear
impression ... that the Iranian side is ready to seek agreement
on concrete actions." These would be taken step by step.
Another proposed step will be an updated version of an idea
first floated in 2009 that envisaged Iran shipping out the bulk
of its low-grade uranium - which could potentially be converted
into weapons fuel - in return for higher-enriched fuel for the
medical research reactor in Tehran, a diplomat said.
It was unclear whether that idea would gain traction after
Iran's announcement on Tuesday that it had supplied its first
batch of domestically made fuel to that reactor - a message
probably meant to boost its leverage in negotiations.
The Islamic Republic launched higher-grade enrichment two
years ago and has since transferred the operation to a bunkered,
underground plant at Fordow that, to Israeli alarm, would be
largely impervious to attack from the air.
"The key issue is the 20-percent enrichment potential. This
has to be addressed in order to have a productive outcome," said
one Western diplomat. "The marching orders for Baghdad are to
have concrete ideas on the table, maybe not necessarily agree on
all details of these ideas, but to have a clear commitment."
Iran, a major oil exporter, says it is enriching uranium for
electricity. That requires fuel refined to 5 percent, although
it will be many years before power stations are built. It also
wants radioactive isotopes for cancer treatment.
Tehran has repeatedly ruled out suspending enrichment as
called for by several U.N. Security Council resolutions.
DEAL ON EXPANDED U.N. INSPECTIONS "CLOSE"
In a possible sign of a new Iranian willingness to address
concerns about its atomic ambitions, the U.N. nuclear supervisor
said on Tuesday he expected to sign a deal soon to unblock an
investigation into suspected Iranian attempts to design a
But Western officials note past failures to carry out deals
on more intrusive inspections between the International Atomic
Energy Agency and Iran, and their patience is running out.
Iran suggested it would try to parlay its reported
rapprochement with the IAEA into a deal in Baghdad to relax
sanctions inflicting increasing damage on its economy, including
a European Union oil embargo due to take effect in July.
But Western officials ruled out such a weighty concession so
soon, even though their call for a "step-by-step" negotiating
process is widely seen as a tacit admission that sanctions will
have to be eased at some point.
"Sanctions are only going to be lifted if we have
significant and genuine progress," one diplomat said.
Israel, widely assumed to have the Middle East's only
nuclear arsenal, has loudly expressed its scepticism about the
chances for diplomacy to rein in its major adversary.
Defence Minister Ehud Barak said Israel was concerned that
the world powers would not press hard enough to put a full stop
its nuclear programme and that Israel would keep all options
open - an allusion to military action - to achieve that goal.
(Additional reporting by Andrew Quinn and William Maclean in
Baghdad, Marcus George in Dubai, Fredrik Dahl in Vienna and
Steve Gutterman in Moscow; Writing by Mark Heinrich; Editing by
Philippa Fletcher and Alastair Macdonald)