At the table with Iran, what could the US concede?

The UN Security Council Saturday unanimously passed a resolution to sharpen sanctions against Iran for its presumed nuclear-weapons ambitions. This unanimity provides the West with an occasion for a bold new diplomatic initiative.

The US should propose a comprehensive, formal dialogue with Iran on nuclear matters that also covers all issues that have divided Washington and Tehran since the cleric-led revolution toppled America's former ally, Shah Muhammad Reza Pahlevi, in 1979.

Before beginning such a dialogue, however, the top officials of the Bush administration should first agree among themselves and with congressional leaders on the discussion's minimum aims – and the maximum concessions the West can offer.

A possible forum to kick-start a real dialogue could be the foreign ministers' meeting soon to be hosted by Iraq. This was agreed to at the earlier, lower-level Baghdad meeting this month on halting Iranian and other foreign interference in the insurgency and sectarian strife in Iraq. Secretary of State Condoleeza Rice's agreement to join Iranian, Iraqi, British, Syrian, and Turkish foreign ministers at the future high-level conference is a helpful and hopeful sign.

Proponents of a US military strike on Iran, especially those among the more than 1 million Iranian exiles in the US, must have been rather startled by a recent Voice of America interview in Persian by Ardeshir Zahedi, former high-profile foreign minister under the shah, Mohammad Reza Pahlavi. He was the late shah's last and most activist ambassador in Washington – no friend of the Iranian mullahs.

Mr. Zahedi urgently cautioned Washington against any military adventure in Iran. Tightened UN and US economic sanctions, he also warned, would cause problems for Iranians, but wouldn't dissuade and might even accelerate the ayatollahs' nuclear programs.

Zahedi alluded to the birth of Iran's program for a full nuclear-fuel cycle to generate electricity back in the 1950s, under the shah's rule. That program profited the US nuclear firms that encouraged and helped finance it, as the shah himself pointed out to this reporter in an interview back in 1966.

Though the mullahs consider Zahedi to be a dangerous enemy, in the interview he agreed with them that Iran, a signer of the Nuclear Non-Proliferation Treaty (NPT), has the absolute right to develop peaceful nuclear energy. He called Western suspicions and accusations about a covert military program "an insult to Iranian dignity."

Assuming that meaningful US-Iranian talks begin, what should minimum US demands be? First and foremost, suspension and eventual halt to anything that looks like enrichment of uranium to weapons-grade levels, or diversion of plutonium from power plants to the same purpose.

Sir Eldon Griffiths, a British diplomat and author who has devoted his career to studying Iran, suggests ways to achieve this.

In a new book, "Turbulent Iran," Mr. Griffiths articulates his peace plan in stages. First, US, British, Iraqi, and Iranian military commanders would meet to end infiltration from Iran into Iraq of arms, cash, and agents of incitement; agree on a liaison between Iran and the US-led coalition in Iraq as the US and British hand over control to Iraqis, and on joint policing of Iran's land and water borders.

Second, in Kabul, Afghanistan, Iranian, Afghan, US, British, and NATO representatives should agree to cooperate in defeating the Taliban, a long-time foe of Tehran. Their other agendas: pacifying western Afghanistan; returning home about 300,000 Afghans who fled to Iran, and cracking down on narcotrafficking, an Iranian priority.

Bilateral US-Iranian meetings should aim to settle old compensation claims: US claims since 1979 for damage and restitution for the US Embassy and other property and citizens in Iran; Iranian claims for additional compensation for the US Navy's mistake in shooting down an Iranian airliner in 1988; and the unfreezing of Iranian assets in US banks.

Such moves could greatly facilitate a crucial nuclear solution. One would be a multinational consortium under World Bank auspices to supervise and participate in Iran's nuclear electric power projects.

Iran would own its nuclear fuel, but would be obliged to hold a "dual key" with expert nuclear inspectors from the International Atomic Energy Agency (IAEA). They would supervise and approve use of fuel to avoid diversion to weapons use. This has been a proposal of Bruno Pellaud, IAEA's former deputy director for safeguards. He says this technique of strict oversight by "interested peers and partners" could exclude an Iranian weapons program.

Despite Iranian President Mahmoud Ahmedinejad's inflammatory rhetoric, Iranians have shown in the past that they are usually amenable to solutions they find to be in their best strategic interest. Now is the time for the US and allies to rise to this opportunity for future Middle Eastern peace and face the challenge of difficult, but potentially fruitful peace diplomacy.

• John K. Cooley, a former Monitor correspondent, covered the Middle East for more than 40 years. His latest book is "An Alliance Against Babylon: The US, Israel and Iraq."