The UN nuclear watchdog chief said yesterday the agency was in "stalemate" with Iran on key issues of trust but that Israeli and French suggestions he was hiding evidence of alleged Iranian atom bomb work were baseless.

The comments by Mohamed ElBaradei, Director General of the International Atomic Energy Agency (IAEA), could be timely for Western powers who will strive in coming weeks to win over Russia and China to far harsher sanctions against Iran.

An August 28 IAEA report said Iran had granted the agency's demand for tighter monitoring of its Natanz nuclear fuel production site and restored some IAEA access to a heavy-water reactor site of proliferation concern.

But it also said Iran had increased its number of installed centrifuge machines by 1,000 to 8,300, boosting potential enrichment capacity, and was still blocking an IAEA inquiry into allegations it has tried to "weaponise" the enrichment process.

Except for Iran's two new gestures of cooperation, "On all... issues relevant to Iran's nuclear programme, there is stalemate," Mr ElBaradei said in remarks opening a quarterly meeting of the IAEA's 35-nation Board of Governors.

He referred to the blocked weaponisation inquiry, Iran's refusal to suspend enrichment as demanded by the UN Security Council, and its failure to adopt an IAEA protocol permitting inspections ranging beyond declared nuclear sites.

The West suspects Iran is pursuing the means to produce atomic bombs behind the façade of a civilian nuclear programme. Iran says it wants only electricity from uranium enrichment.

President Mahmoud Ahmadinejad declared yesterday Iran would pursue uranium enrichment, regardless of the risk of more punitive sanctions.

The IAEA report described as compelling Western intelligence material implying Tehran secretly combined projects to process uranium, test explosives at high altitude and revamp a missile cone in a way that would fit a nuclear warhead.