Iran rejected a repeated demand by the UN Security Council to suspend uranium enrichment work after the 15-nation body imposed arms and financial sanctions on Tehran. At the same time major powers, who drafted the resolution passed on Saturday, immediately offered new talks and renewed their offer of an economic and technological incentive package.

But the sanctions would stay in place until Iran halts the enrichment of uranium and the reprocessing of spent nuclear fuel, which can be used to make a bomb or to generate electricity.

Iran?s Foreign Minister Manouchehr Mottaki, who held a news conference yesterday, told the Security Council after the vote it had been abused and manipulated by some of its members to take ?unjustifiable action? against a peaceful nuclear program. ?I can assure you that pressure and intimidation will not change Iranian policy,? he said. ?Suspension is neither an option nor a solution.?

?The world must know - and it does ? that even the harshest political and economic sanctions or other threats are far too weak to coerce the Iranian nation to retreat from their legal and legitimate demands,? Mottaki said.

The resolution goes beyond the nuclear sphere by banning Iranian exports of conventional arms and freezing financial assets abroad of 28 individuals and entities, including Bank Sepah and the commanders of the Revolutionary Guards.

Some of those affected are said to be involved in supporting military movements abroad.

The new measures are a follow-up to a resolution adopted on December 23 banning trade in sensitive nuclear materials and ballistic missiles, as well as also freezing assets of individuals and institutions associated with atomic programs.

European Union foreign policy chief Javier Solana told reporters at an EU summit in Berlin he would contact Ali Larijani, Iran?s main negotiator on nuclear issues,yesterday ?to see whether we can find a route to negotiations?.

Curtailing of new investments

The foreign ministers of countries that drafted the resolution ? the United States, Britain, France, Russia, China and Germany ? proposed further talks with Iran ?to see if a mutually acceptable way can be found to open negotiations,? according to a joint statement read by British Ambassador Emyr Jones Parry.

US representative Alejandro Wolff warned that adoption of Resolution 1747 sent ?a clear and unambiguous message to Iran? that the pursuit of a nuclear weapons capability ?will only further isolate Iran and make it less, not more, secure.?

Western diplomats believe the new bans, and those imposed in December, are having an impact on curtailing new investments in Iran but leave the country?s oil industry intact.

But Iran?s Mottaki, noting the scope of the sanctions, said, ?What can harming hundreds of thousands of depositors in Bank Sepah, with a 80-year history in Iran, mean other than confronting ordinary Iranians??

US Undersecretary of State Nicholas Burns said in Washington the arms embargo was most significant in that it prohibits a transfer of Iranian weapons to Lebanon?s Hezbollah guerrillas, the Palestinian Hamas movement, Syria or ?to any state or terrorist organization?.

Israeli Prime Minister Ehud Olmert welcomed the resolution, saying such measures could ultimately curb Iran?s nuclear ambitions.

Israel, which is believed to have the Middle East?s only atomic arsenal, has hinted it could resort to military strikes if diplomacy fails to rein in its arch-foe?s nuclear programme.

The big powers negotiated intensively over the past month, with last-minute talks first with South Africa and then with Indonesia and Qatar, who wanted a reference to a nuclear-free Middle East, which was inserted into the preamble.

Ambassador Nassir Abdolaziz al-Nasser of Qatar, the only Arab country on the council, spoke against the resolution for its potential to destabilize the Middle East.

But he voted in favour, preserving the unanimous vote, after South Africa and Indonesia gave notice they would vote in favour.

Another issue adding tension to relations with Iran was the detention of 15 British naval personnel by Iran on Friday. Britain requested access to the 15 sailors yesterday, insisting they had been in Iraqi waters, not Iranian.

Evelyn LEOPOLD

DIPLOMATIC CRISIS

UK envoy seeks access to detained sailors

■ The British envoy to Tehran yesterday requested access to 15 detained British naval personnel who Iran says entered Iranian waters illegally despite Britain?s insistence they were in Iraqi territory, a diplomat said. Iranian forces captured 15 British sailors and marines on Friday at the mouth of the Shatt al-Arab waterway, which marks the southern stretch of Iraq?s border with Iran. It has sparked a diplomatic crisis when tensions are already high with the West over Tehran?s nuclear programme. Britain?s Ambassador Geoffrey Adams met Iranian Foreign Ministry official Ebrahim Rahimpour to discuss the issue at London?s request, a British diplomat in Tehran told Reuters. ?We have repeated the line asking for their release,? the diplomat said.

?The (Iranian Foreign Ministry) promised to look into these requests and dialogue is continuing,? the diplomat added. Iran?s semi-official Fars news agency reported on Saturday that the 15 sailors had been transferred to Tehran. But this has not been independently confirmed. Jack Straw, leader of Britain?s House of Commons told BBC television that one of those detained was a woman and said British Foreign Ministry officials were ?working very hard indeed to try to secure their safe return?. Britain said two boatloads of Royal Navy sailors and marines had searched a merchant vessel on a UN approved mission in Iraqi waters when Iranian gunboats encircled and captured them. An Iraqi fisherman who said he saw Iranian forces detain them, said on Saturday the ship British forces were searching was anchored in Iraqi waters. The incident sent oil prices to a three-month high on Friday. It took place a day after Iran launched a week of naval war games along its coast, including the Gulf?s northern reaches which give access to the oil output of Iraq, Iran and Kuwait.