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World Powers Agree on 'Far Reaching' Nuclear Proposals to Iran

Foreign ministers of major world powers meeting in Vienna have reached agreement on a package of incentives for Iran to halt sensitive nuclear activities, or penalties if it refuses. The offer will now be formally conveyed to Iran.

The agreement by the five permanent U.N. Security Council member countries and Germany came at the end of a day of talks in the Austrian capital and climaxed weeks of sensitive negotiations on how to get Iran to cease nuclear activities U.S. and European officials believe are weapons-related.

The so-called "carrots and sticks" package would offer Iran a set of financial and technology incentives if it ended uranium enrichment and returned to nuclear negotiations with Britain, France and Germany.

If it refuses, there would be U.N. Security Council action against Iran and escalating sanctions.

The agreement was announced by Britain's new foreign secretary, Margaret Beckett, with her counterparts from the United States, France, Germany, China and Russia standing alongside.

She did not provide the terms but said it was a far-reaching set of proposals that offers Iran a chance to have a negotiated settlement of the crisis over its nuclear program, based on cooperation:

"We are prepared to resume negotiations should Iran resume the suspension of all enrichment-related and reprocessing activities as required by the IAEA, and we would also suspend action in the Security Council," said Margaret Beckett. "We've also agreed that if Iran decides not to engage in negotiations, further steps would have to be taken in the Security Council. So there are two paths ahead. We urge Iran to take the positive path and to consider seriously our substantive proposals which would bring significant benefits to Iran."

The agreement came a day after the Bush administration, in a policy shift, said it was willing to take a direct part in the European-led talks on the Iranian nuclear program provided Tehran suspended uranium enrichment and related activity U.S. officials believe is weapons-related.

Iranian Foreign Minister Manouchehr Mottaki said his government welcomed dialogue but would not give up its rights - a reference to Tehran's insistence that it is entitled to enrich uranium under the nuclear Non-Proliferation Treaty.

In comments at the end of a White House cabinet meeting Thursday, President Bush said it remains to be seen if Iran's seemingly-negative response to the proposal is its last word on the subject:

"My reaction is that the choice is theirs, and we'll see whether or not that is the firm position of their government," said President Bush. "And if that's what they decide to do, then the next step, of course, will be for our coalition partners to go to the United Nations Security Council. And the choice is up to the Iranians. And they've already said, by the way, that they're willing to suspend [enrichment]. And this gives them a second chance to make their words mean something."

Iran had agreed in talks with EU-3 in 2004 to halt uranium enrichment, but backed out of the deal and earlier this year began enriching uranium for what it insists is a peaceful civil nuclear program.

President Bush said he had spoken by telephone with Russian President Vladimir Putin and Chinese President Hu Jintao, whose support was considered critical to the incentives and sanctions package finalized later in Vienna.