Siavosh Ghazi

Iran said on Monday it was interrogating 15 British sailors it seized last week, claiming they had entered its waters illegally and defying intense international pressure for their release. As the diplomatic row deepened, Britain ambassador Geoffrey Adams held more talks at the Foreign Ministry in Tehran and was assured that the group was "fit and well".

Iran on Tuesday gave a cautious reception to an international proposal aimed at resolving the crisis over its disputed nuclear drive, saying the offer contains "positive steps" but also "ambiguities". The package, presented by European Union foreign policy chief Javier Solana, offers a variety of incentives and fresh multilateral talks if Tehran agrees to suspend uranium-enrichment work.

Iran warned on Tuesday it will sever relations with the United Nations atomic watchdog if sanctions are imposed over its nuclear drive and vowed a military attack would merely send its activities underground. Despite the tough rhetoric, diplomats in Vienna said a high-level Iranian delegation was to hold last-minute talks on Wednesday with the UN atomic agency.

A defiant Iran vowed on Wednesday that nothing could halt its controversial nuclear programme, in a direct challenge to the United Nations Security Council that could risk international sanctions. With the country basking in national pride after scientists successfully enriched uranium to make nuclear fuel, officials pledged to move rapidly to industrial-scale work.

Eight people were killed in a double bomb attack on Tuesday in the restive southwestern Iranian city of Ahvaz, where a scheduled visit by President Mahmoud Ahmadinejad had been cancelled at the last minute. The media said a first bomb in Ahvaz exploded in front of a privately-run bank and a second in front of a government office for natural resources.