Russia's Putin sees hope after talks with Iran

BAKU, Feb 22 (Reuters) President Vladimir Putin said today he still saw a chance of Russia striking a deal with Iran, which could defuse an international crisis over Tehran's nuclear ambitions and boost Moscow's international profile.

But a source close to talks, at which Russian and Iranian delegates discussed Moscow's proposal to enrich uranium for Tehran, was quoted as saying the sides had stumbled on a crucial point on which neither was ready to compromise.

An agreement to pursue discussions this week during a visit to Tehran by the head of Russia's nuclear agency Rosatom was the only visible result of two days of talks that ended yesterday.

''The negotiations are not easy but we are counting on reaching a positive result,'' Putin said in the Azerbaijan capital Baku. ''We are not losing optimism.'' Iran's departure from a moratorium on nuclear research and uranium enrichment has fuelled Western fears that Tehran is building its own atomic bomb. Iran denies such suggestions, saying it is keen only to develop its own nuclear energy sector.

Tehran may face action by the UN Security Council, under pressure from the United States, after the head of the International Atomic Energy Agency issues a board report on Iran's nuclear programme to a March 6 meeting of the UN watchdog's governing board.

Russia and China are opposed to imposing sanctions on Iran, which they believe would not work and make things worse.

Moscow's proposal to offer its facilities to enrich Iranian uranium has been welcomed by the West as a way of guaranteeing that Tehran does not obtain weapons-grade fuel.

''The proposed Russian variant of resolving this question, by creating a joint venture to enrich uranium on Russian territory, is fully acceptable and can be used as an instrument to solve this problem,'' Putin said.

More Reuters SRS GC2116