Why Iran must make the next move

With the US in danger of failing in Iraq and Israel thwarted in Lebanon, Iran sensed a historic opportunity last summer to spread its influence, make itself safer, roll back the US and promote Islamic solutions in the region. A blend of bilateral dialogue, multilateral diplomacy, UN measures, and military deployments, pursued vigorously this year, is now needed to blunt Iranian militancy and move the nuclear issue in the right direction without provoking a further war.

Iran is a danger because of what it does in Iraq and Lebanon and what it threatens to do, including wiping Israel off the map. The consequences of military action are so serious, however, that governments have a responsibility to ensure that the diplomatic options are pursued to the end. That has not happened yet.

This is not to take the military option off the table — but to be more precise about it. Military action should be used in accordance with international law in self-defence or to prevent a clear and imminent threat.

Such a threat has not crystallised yet. According to the International Institute of Strategic Studies, Iran could make enough highly enriched uranium for one nuclear bomb in two years — assuming that that is what it intends to do clandestinely.

In the stalled negotiations, it is Iran's move now, and it is too soon to say whether they will budge. Their leadership have seemingly boxed themselves in by vowing not to retreat a single step, but they could carry domestic opinion with them in a U-turn if the alternative was worse. A climbdown could be eased for them, through a face-saving solution for both sides, as the Permanent Members of the Security Council and Germany tried in the talks led by Mr Solana last autumn. There are some signs of a reassessment in Iran of the costs and benefits of its policy of confrontation. The opprobrium it brought them internationally has dismayed many in Iran.

This is because it has become clear to them that the international community has leverage and may use it further. If Iran does not re-suspend its enrichment activities as called for by the UN, this pressure should increase, including through measures by European governments and companies over and above those required by Security Council Resolution 1737.

It is still vital that Iran suspends enrichment work, in accordance with the UN decision, as a precondition for negotiation: for two reasons. If development and installation of dual-use equipment were forging ahead, no one could have confidence that an accommodation could be reached. The permanent five and Germany want to facilitate a weapons-proliferation-proof nuclear power programme in Iran for the long-term future. That means not prejudging the outcome on enrichment facilities in advance.

To strike a deal, the permanent five may need to be flexible on the exact terms of the offer they made to Iran in May 2006. There should be more precise language on security assurances to Iran and a serious initiative to create regional security cooperation.

US policy evolved in 2006 in favour of negotiating with Iran if it should resuspend its enrichment activities. If a multilateral negotiation to resolve the nuclear dispute were to begin, there is more the US could and should do to promote more responsible behaviour by Iran.

No two countries with such a past could reach a "grand bargain" in one bound. A process should begin with a joint commitment to explore a wide-ranging agenda over time in order to reduce tensions. Getting the necessary political cover for starting would require a public statement of a shared aim to improve security in the region, and of an intention to examine the issues that divide the two countries. This could be reinforced by preliminary quick wins: decisions to change an aspect of policy significant to the other. Iran could agree to an information exchange on Al-Qa'eda, a shared enemy, and the US could state that it does not have a hostile intention towards the Iranian people. Decisively presented to domestic audiences, this could protect each side from its own doubters.

This will not happen before it has sunk into Iran that their situation at home and abroad is not as strong as they maintain it is for domestic consumption. The Europeans can help here by being firm. Still it is a fact that Iran needs an accommodation with the US because there are things only the US can unlock, including UN and US sanctions.

Nor are bilateral US/Iran talks likely to get far before the US has reduced the harm caused to its interests by the Lebanon war, Iraq, the festering of the Middle East peace process and the perception of disunity at home and collapsed prestige abroad. This has started with the decisions President Bush made in December. It means showing that Hizbollah will not roll the Lebanese government over; that Iranian agents in Iraq have reason to fear arrest; that a balance of power can be maintained in the Gulf; that the flow of oil will be safe.

It is wrong to dismiss the US moves so far to counter Iranian ambitions as bellicose. US critics fear escalation from minor events, and that cannot be ruled out. But there is not enough evidence to dispute US assertions that it is on a diplomatic path in its dealings with Iran. The US gives every appearance of calibrating its response to Iranian actions. This is good news both for the hoped-for evolution of US policy towards a direct dialogue with Iran and for getting a clear message through to Iran that they will not push the US aside. There is no time to lose.