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Iran appears to be headed — once again — toward conflict with the rest of the world over its nuclear programs. Tehran has rejected a European proposal that was designed to end concerns over its determination to develop facilities that would allow Iran to build a nuclear weapon — an objective the Iranian government says it does not have. The International Atomic Energy Agency (IAEA), the world’s nuclear watchdog, last week expressed serious concern over the program, but it has given the parties a few more weeks to find a solution. A great deal rides on that solution — including perhaps the ultimate contours of any agreement with North Korea.

There are many questions surrounding Iran’s nuclear energy program, not least of which is why a country so rich in energy resources even needs such an effort. Iranian officials have long maintained that Iran should diversify its energy supplies and that it has a right to do so as a member of the IAEA and the Nuclear Nonproliferation Treaty (NPT). Iran’s credibility has been eroded by the steady drip of revelations that show Tehran has been less than forthcoming in its declarations to the IAEA, the discovery of undisclosed facilities, and programs and research seemingly at odds with a peaceful program. Nonetheless, the IAEA has only expressed concern over Iranian activities; it has yet to find Iran in violation of its NPT obligations.

The key concern is Iran’s intent to develop the capacity to enrich and reprocess uranium. This capability is needed to ensure that Iran has fuel for its nuclear-power reactors — natural uranium is not sufficient — and to dispose of the waste generated by the production of energy. Enriched uranium can also be used for a bomb, however, and there is no way to ensure that the fuel developed for peaceful purposes is not diverted for weapons. There is also concern over the spent fuel; it too could be processed to provide materials to make a bomb.

Last November, Iran suspended its enrichment program while it began negotiations with the European troika — Britain, France and Germany — over ways to allay these concerns. Negotiations focused on ensuring a supply of nuclear fuel and other trade and economic incentives for Iran that would better integrate it into the world economy; backing for Iran’s membership in the World Trade Organization was one component of the deal. Tehran has become increasingly frustrated with the pace of those talks and has said that the lack of progress obliged it to resume enrichment activities. That threat prodded the troika to up their offer to include more generous political and economic incentives, as well as more advanced nuclear technologies.

That still was not enough for Tehran. While the European Union proposal guarantees a source of fuel, it does not acknowledge Iran’s right to enrich uranium, which is inherent in the NPT. As a result, Tehran has asked IAEA inspectors to return to Iran to observe the removal of seals on reprocessing equipment so that work could resume. (The IAEA obliged.) Iran has said that it will continue to honor IAEA safeguards, however.

That stalemate brought Iran before the IAEA board of directors last week. Meeting at the behest of the EU troika, the board expressed “serious concern” over the resumption of nuclear activities and set a Sept. 3 deadline for Iran to stop the uranium conversion activities. If there is no agreement by then, the board could refer the issue to the United Nations Security Council, which could then impose sanctions on Iran. At this time, however, all parties remain committed to a diplomatic solution.

The reluctance of the IAEA to take more serious action reflects a critical division on the board: Despite concerns about Iranian intentions, the NPT allows all countries the right to reprocess uranium as long as it does not violate its treaty obligations. There is no proof that Iran is cheating and therefore Tehran maintains the right to reprocess. The success of any deal with Iran ultimately depends on squaring that particular circle.

Any solution will also be closely watched by North Korea, too. Pyongyang also demands the right to maintain a peaceful nuclear-energy program and North Korean pride will dictate that it not be singled out. In other words, any deal with Tehran will serve as a benchmark for negotiations with Pyongyang.

In both cases, success depends on the governments in Tehran and Pyongyang realizing that nuclear weapons do not enhance national security, but detract from it. For their part, each country’s negotiating partners must recognize — and respond to — the fundamental insecurities that drive it to seek a nuclear weapon. In other words, the focus should be on demand-side solutions to the proliferation problem.

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