US President Barack Obama and the leaders of Britain and France yesterday accused Iran of building a secret nuclear fuel plant and threatened tough new sanctions unless Teheran comes clean about its nuclear programme.

Sharpening a stand-off with the Islamic Republic, Mr Obama went public with the charge standing shoulder to shoulder with Prime Minister Gordon Brown and French President Nicolas Sarkozy at a Group of 20 summit in Pittsburgh.

"Iran is breaking rules that all nations must follow ... and threatening the stability and security of the region and the world," Mr Obama said in a stern message just a week before Teheran's much-anticipated talks with the United States and five other powers known as the P5+1 negotiations.

Iran, which acknowledged the existence of the facility for the first time on Monday in a letter to the International Atomic Energy Agency, insisted the uranium enrichment plant was within the parameters of the UN nuclear watchdog's rules.

"We have no secrecy, we work within the framework of the IAEA," Iranian President Mahmoud Ahmadinejad told Time magazine, saying Teheran was not obliged to inform the Obama Administration of every nuclear facility it has.

Western leaders took a different view of Iran's belated disclosure of the facility, which US officials said Iran had been building for several years inside a mountain close to the holy city of Qom.

The revelation intensified Western fears of an Iranian bid for nuclear weapons. Teheran insists its nuclear programme is for peaceful purposes to generate electricity.

Mr Obama said Iran's action "represents a direct challenge to the basic foundation of the nonproliferation regime".

Mr Brown accused Iran of "serial deception" in its nuclear programme and Mr Sarkozy said Teheran had until December to comply or else face new international sanctions.

Russia said it was alarmed by Iran's disclosure. China urged Iran to cooperate with the UN inspectors but said it still wanted a negotiated solution.

German Chancellor Angela Merkel said her country was "very worried" about Iran's construction of a second nuclear site.

Meanwhile, officials reported that a small plane flew into restricted airspace over the Group of 20 summit yesterday and was escorted to a nearby airport by two F-15 fighter jets.

Protesters march against summit

More than 1,000 protesters gathered to march against capitalism and the Group of 20's summit agenda yesterday as businesses cleaned up from a night of skirmishes on Pittsburgh streets.

Protesters - from environmentalists, socialists, Palestinians and Tibetans to union workers - listened to a folk singer as a police in body armour watched the crowd gather.

They held up signs such as We Say No To Corporate Greed, and G20 = Death by Capitalism.

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