Iran said it would not share intelligence with the United States about al Qaeda members it is holding and dismissed U.S. charges that anti-American fighters were slipping across its borders into Iraq.
U.S. Deputy Secretary of State Richard Armitage said on Tuesday Washington was prepared to resume limited contacts with the Iranian government but that relations would not improve until Tehran shared intelligence on al Qaeda.
"We don't have any relations with American security services so there is no reason to do anything on this issue," government spokesman Abdollah Ramazanzadeh told a weekly news conference.
President Mohammad Khatami rebuffed a call by President Bush Tuesday for Iran and Syria to tighten their borders to stop fighters crossing into Iraq.
"The accusations are not new, they have always made such baseless charges," Khatami told reporters.
Washington broke off talks with Tehran over Iran's neighbors Afghanistan and Iraq in May after accusing Iran of sheltering al Qaeda members behind bombings in Saudi Arabia on May 12 which killed 35 people.
Iran denies cooperating with al Qaeda and says it has caught and extradited hundreds of suspected members of Osama bin Laden's network who fled from Afghanistan and Pakistan in the last two years.
Ramazanzadeh noted that Armitage's comments on resuming talks with Iran were the first such remarks from a U.S. official for some time but added that Tehran was waiting for Washington to take "practical steps" to improve relations.
"It is not possible to threaten a country, to block its assets, to accuse it and then want talks," he said.
Washington broke ties with Tehran shortly after the 1979 Islamic revolution. Low-level talks have occasionally taken place in third countries to discuss specific issues but neither side has made a concerted effort to normalize relations.
In Iran, restoring ties with the country Shia religious leaders refer to as the "Great Satan" is considered a virtually taboo subject and government officials rarely confirm that contacts with U.S. officials have taken place.
Political analysts in Tehran said Iran's recent decision to agree to tougher inspections of its nuclear sites and suspend uranium enrichment may have encouraged Washington to resume its dialogue with Tehran.
Events in Iraq, where anti-American attacks blamed by some on foreign fighters show little sign of fizzling out, are another motivating factor for Washington, they said.
Tehran last week handed over to the United Nations Security Council a list of more than 200 names of al Qaeda members it has recently extradited to their home countries.
Washington dismissed the Iranian move, saying Iran should turn over all al Qaeda members to the United States, their country of origin or third countries.
**PHOTO CAPTION***
Iran's government spokesman Abdullah Ramazanzadeh speaks with journalists after the weekly cabinet meeting in Tehran on October 29, 2003. (Morteza Nikoubazl/Reuters)