Iran said yesterday it would continue enriching uranium despite intense pressure from nations worried it could develop its own nuclear arms.

A suspension of uranium enrichment is one of the demands of an October 31 deadline set by the International Atomic Energy Agency (IAEA) that is calling on the Islamic Republic to prove it is not seeking a nuclear warhead.

"We will not allow anyone to deprive us of our legitimate right to use nuclear technology, particularly (uranium) enrichment for providing fuel for nuclear plants," Foreign Minister Kamal Kharrazi was quoted as saying by the official IRNA news agency.

Enriched uranium can be used to fuel nuclear power stations but if enriched further can be used in atomic weapons.

Iran says enrichment is key to the country's civilian nuclear energy programme because it means the whole project can be home-grown - from mining uranium ore to fuelling reactors - with no dependence on foreigners at any stage of the process.

"The Iranian nation, by using the abilities and expertise of its own children, has decided to pursue the path of progress," President Mohammad Khatami said in a public speech in Khuzestan province, also carried by IRNA.

Political analyst Hossein Rassam told Reuters Iran was committed to the complete fuel cycle. "Enrichment is not something Iranians will easily give up," he said.

Countries such as the United States fear that allowing Iran to continue its uranium enrichment, even under IAEA supervision, would give Iran a potential "break out" capacity to produce nuclear arms.

The IAEA declined comment but diplomats in Vienna said it was important for Iran to try to patch up what they describe as a serious "confidence deficit".

"Iran is not doing much to inspire confidence at the moment," one diplomat told Reuters. However, diplomats from IAEA board nations acknowledge the demand to put enrichment on hold is not legally binding.

Iran insists weapons-grade uranium found in the country originates from contamination when equipment was bought in from abroad. On Monday Tehran said it would give the IAEA a list of imported components.

A speech from Supreme Leader Ayatollah Ali Khamenei, who has the last word on all state issues, also lambasted pressure on Iran's nuclear programme and exhorted people to resist the country's enemies.

"The international power centres, by continuing their plots, have aimed to impede this country's progress," he was quoted as saying in the hardline Jomhuri-ye Eslami newspaper. "All people... should stand up against the enemy's demands."

However, Kharrazi said Iran had no plans to quit the nuclear Non-Proliferation Treaty (NPT), a course espoused by hardliners.

"Iran is one of the proponents of the NPT and is determined to remain one of its signatories," he told the conference.

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