By Philip Sherwell in Washington
The man who for two years led Iran's nuclear negotiations has laid out in unprecedented detail how the regime took advantage of talks with Britain, France and Germany to forge ahead with its secret atomic programme.
In a speech to a closed meeting of leading Islamic clerics and academics, Hassan Rowhani, who headed talks with the so-called EU3 until last year, revealed how Teheran played for time and tried to dupe the West after its secret nuclear programme was uncovered by the Iranian opposition in 2002.
He boasted that while talks were taking place in Teheran, Iran was able to complete the installation of equipment for conversion of yellowcake - a key stage in the nuclear fuel process - at its Isfahan plant but at the same time convince European diplomats that nothing was afoot.
"From the outset, the Americans kept telling the Europeans, 'The Iranians are lying and deceiving you and they have not told you everything.' The Europeans used to respond, 'We trust them'," he said.
Revelation of Mr Rowhani's remarks comes at an awkward moment for the Iranian government, ahead of a meeting tomorrow of the United Nations' atomic watchdog, which must make a fresh assessment of Iran's banned nuclear operations.
The judgment of the International Atomic Energy Agency (IAEA) is the final step before Iran's case is passed to the UN Security Council, where sanctions may be considered.
In his address to the Supreme Council of Cultural Revolution, Mr Rowhani appears to have been seeking to rebut criticism from hardliners that he gave too much ground in talks with the European troika. The contents of the speech were published in a regime journal that circulates among the ruling elite.
He told his audience: "When we were negotiating with the Europeans in Teheran we were still installing some of the equipment at the Isfahan site. There was plenty of work to be done to complete the site and finish the work there. In reality, by creating a tame situation, we could finish Isfahan."
America and its European allies believe that Iran is clandestinely developing an atomic bomb but Teheran insists it is merely seeking nuclear energy for peaceful purposes. Iran's negotiating team engaged in a last-ditch attempt last week to head off Security Council involvement. In January the regime removed IAEA seals on sensitive nuclear equipment and last month it resumed banned uranium enrichment.
Iran is trying to win support from Russia, which opposes any UN sanctions, having unsuccessfully tried to persuade European leaders to give them more time. Against this backdrop, Mr Rowhani's surprisingly candid comments on Iran's record of obfuscation and delay are illuminating.
He described the regime's quandary in September 2003 when the IAEA had demanded a "complete picture" of its nuclear activities. "The dilemma was if we offered a complete picture, the picture itself could lead us to the UN Security Council," he said. "And not providing a complete picture would also be a violation of the resolution and we could have been referred to the Security Council for not implementing the resolution."
Mr Rowhani disclosed that on at least two occasions the IAEA obtained information on secret nuclear-related experiments from academic papers published by scientists involved in the work.
The Iranians' biggest setback came when Libya secretly negotiated with America and Britain to close down its nuclear operations. Mr Rowhani said that Iran had bought much of its nuclear-related equipment from "the same dealer" - a reference to the network of A Q Khan, the rogue Pakistani atomic scientist. From information supplied by Libya, it became clear that Iran had bought P2 advanced centrifuges.
In a separate development, the opposition National Council of Resistance of Iran (NCRI) has obtained a copy of a confidential parliamentary report making clear that Iranian MPs were also kept in the dark on the nuclear programme, which was funded secretly, outside the normal budgetary process.
Mohammad Mohaddessin, the NCRI's foreign affairs chief, told the Sunday Telegraph: "Rowhani's remarks show that the mullahs wanted to deceive the international community from the onset of negotiations with EU3 - and that the mullahs were fully aware that if they were transparent, the regime's nuclear file would be referred to the UN immediately."