The New Nation - Internet Edition

AP, United Nations

Major U.N. Security Council powers have agreed on an incremental increase in sanctions on Iran, including a new restriction on exporters doing business with the country, diplomats said Thursday.

A draft resolution also calls for more monitoring of Iran's military and financial institutions, broader travel bans on Iranian nuclear scientists and other key officials, and freezing the assets of people and banks linked to weapons proliferation, Security Council diplomats told The Associated Press. Diplomats from the five nations with veto power on the council - the U.S., Russia, China, Britain and France - spent a third day negotiating a final agreement on principles that would form the basis for a third round of U.N. sanctions on Iran. They were joined by Germany, which has long been involved in efforts to resolve the Iran nuclear dispute.

The general terms were hammered out in Berlin earlier this week, chiefly through negotiations between U.S. Secretary of State Condoleezza Rice and Russian Foreign Minister Sergei Lavrov. Those elements have been closely held, though they have begun circulating among the rest of the 15-member council.

Russia and China, which have strong business ties with Iran, resisted earlier British and French draft principles pushing for harsher sanctions if Iran keeps refusing to stop enriching uranium - a process that can provide fuel for a nuclear reactor or fissile material for a bomb.

Iran says its nuclear program seeks only to generate electricity.

The Bush administration continues to press the case that Iran tests ballistic missiles, enriches uranium toward building an atomic bomb, hides information and remains in violation of two previous U.N. Security Council resolutions.

On Wednesday, Russia said the new resolution would not impose harsh sanctions against Iran.

But Nicholas Burns, the U.S. undersecretary of state for political affairs, rejected that claim Thursday, saying the resolution was "meant to be punitive."

He said the draft increases travel restrictions on Iranian nuclear scientists, bans trade in items that can be used for nuclear purposes and freezes more Iranian assets.

Because it lacks significant trade with Iran, the United States must rely on influencing other major nations to apply economic pressure on the country.

Security Council diplomats, who spoke on condition of anonymity because negotiations were sensitive, said the new resolution would impose new credit restrictions on exporters. Such measures could complicate matters for nations such as Germany and Italy that are major trading and investment partners with Iran and have billions of dollars of export credits at risk. The proposed resolution would make it more difficult to obtain those credits.

Diplomats say a third round of sanctions is unlikely to be approved until next month after the International Atomic Energy Agency, the U.N. nuclear watchdog based in Vienna, receives more answers from Iran. Iran agreed to answer all remaining questions about its nuclear activities after IAEA director Mohammed Elbaradei visited Tehran in January.