DUBAI: Iran said on Tuesday it planned to build its first nuclear-powered submarine, a news agency reported, an announcement that came days before talks with world powers and may add to Western concerns over its atomic activities. 

“Preliminary steps in making an atomic submarine have started and we hope to see the use of ... nuclear submarines in the navy in the future,” deputy navy commander Abbas Zamini was quoted as saying by Iran's Fars News Agency.

Many nuclear-powered submarines use as fuel uranium enriched to levels that could also be suitable for atomic bombs, said Mark Hibbs, a nuclear proliferation expert at the Carnegie Endowment for International Peace, a diplomatic think-tank.

He suggested Tehran could use the submarine project to justify refining uranium to higher levels.

However analysts say Iran at times exaggerates its nuclear and military advances to try to strengthen its bargaining position with world powers who want curbs on Tehran's atomic programme to ensure it is for peaceful ends only.

Iran denies Western accusations that it is seeking to build nuclear weapons, saying it simply wants to generate electricity.

Zamini said all countries had the right to use peaceful nuclear technology, including for the propulsion system of their vessels, Fars reported.

NEW TALKS

Tehran is now refining uranium to a fissile concentration of up to 20 percent. This is below the 90 percent concentration needed for nuclear arms and any attempt to process to higher levels would alarm the West and Israel.

Tehran is due to hold a new round of nuclear talks with the United States, China, Russia, Germany, France and Britain in Moscow on June 18-19.

European Union officials said on Monday that Tehran had agreed to discuss a proposal to curb its output of uranium enrichment.

The United States and Israel have not ruled out military action if diplomacy fails to resolve the dispute.

Hibbs said only a few countries in the world - the United States, Russia, France and Britain - had nuclear-powered submarines. “If Iran moves forward on this project it would be for political reasons. Iran could easily defend itself with conventional submarine technology,” he said.

At talks in Baghdad in May, world powers proposed that Tehran stop production of 20 percent uranium enrichment, close the Fordow underground facility where such work is done and ship any stockpile out of the country.

In return, they offered to supply it with fuel for a medical research reactor in Tehran, which requires 20 percent uranium, and to ease sanctions on the sale of parts for commercial aircraft to Iran.

No agreement was reached in Baghdad but the seven countries agreed to continue discussions in Moscow.