INTERVIEWER: The Foreign Secretary, Jack Straw, met Israelis, Palestinians and a number of leading Arab figures here in Davos last night, and this morning about now he's starting talks about Iran. I spoke to him just before we came on air about Iran and their nuclear plans. I asked him what he believed their nuclear ambitions really were.

FOREIGN SECRETARY: We think that they are developing a nuclear weapons capability. We can't be sure, we've always made that clear, but the circumstantial evidence, including twenty years of deceit, research on polonium and plutonium and, for example, the find that the weapons inspectors themselves made of this manual on how to produce a depleted uranium hemisphere, which is an essential component for a nuclear weapon and not for anything else, and which came from AQ Khan, the nuclear weapons expert, point in that direction. Now, the Iranians say that they have no such ambitions. What we have said is that there have to be objective guarantees that their nuclear power programme cannot lead to a nuclear weapons capability because of the unquestionable record of deceit in the past.

INTERVIEWER: So where do we go from here? You've made your position clear. You wanted to go to the Security Council. Iran is digging its heels in. It says Israel is a nuclear power in the Middle East, why should we not have the right, like any other country, to develop a peaceful nuclear programme, which it insists it is, how you move from here?

FOREIGN SECRETARY: Well, they do have a right to develop a peaceful nuclear programme under what's Article 4 of the Non-Proliferation Treaty. The problem is that can collide with their very clear obligation under Article 2 of the same treaty not to develop anything that can lead to a nuclear weapons capability. And I would prefer this matter no to go to the Security Council. It is Iran, in a sense, which is forcing everybody else's hand, because they unilaterally decided to break the seals, the IAEA seals, which were an essential component for producing highly-enriched uranium. So there's going to be some intense diplomacy, but we have an emergency board meeting on the 2nd and 3rd of February at the end of next week, and the issue before us is do we, if there's no change in the uranium position, do we seek a resolution to refer the matter to the Security Council at that stage or is it delayed until the March 6th meeting.

INTERVIEWER: Is there any sign that the Iranians are talking…willing to talk?

FOREIGN SECRETARY: They are willing to talk and there will be a meeting of the European 3 political directors with the deputy head of the negotiating team, Mr. Vaidi, in Brussels on Monday and that, that's movement. The question is in what circumstances are they talking, and what I hope is that the Iranians do understand that there is concern not just in, amongst the old enemies of the United states or the old Europeans, but across the world about Iran's nuclear intentions, which is why, back in September, the IAEA board of governors passed a resolution by a bigger vote than the Iranians anticipated to say that they have been non-compliant.

INTERVIEWER: Senator John McCain of Arizona - very serious figure on the American scene - is here in Davos and he said last night that it was important to retain what he called the 'leverage' of the military option against Iran. Do you agree with that?

FOREIGN SECRETARY: Well, I understand that's the American position. Our position is different and I've repeated it often enough.

INTERVIEWER: The Prime Minister doesn't seem to make much distinction between his position and the American position.

FOREIGN SECRETARY: Well, look, there isn't a military option. There certainly isn't one on the table, I mean let's be clear about that, and no one's talking about it. I mean, I've never had a discussion with any senior American from the very top downwards except to say the military option is not on the table. So I understand the anxieties about that. Of course they're going to be there because of Iraq, but it genuinely is not on the table.

INTERVIEWER: To what extent is this whole argument complicated by what happened in the Palestinian elections and the fall out from that with respect to Israel?

FOREIGN SECRETARY: I don't think it's directly complicated by that. Of course it's the case that Iran actively supports the Hizbollah Shia group in the Lebanon and also active in Israel, and helps to fund Hamas, but it's not directly related. That's a separate issue because it's in everybody's interests that we try and produce a greater degree of stability across the wider Middle East, in the occupied territories and in Iran.

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