World Powers, Iran Exchange Offers at 'Useful' Talks

World powers and Iran on Tuesday exchanged offers at "useful" talks in Kazakhstan aimed at breaking a decade of deadlock over Tehran's nuclear drive, despite low expectations of any deal.

The meeting in the Kazakh city of Almaty comes as sanctions bite against the Islamic republic and Israel still refuses to rule out air strikes to knock out Iran's suspected nuclear weapons drive.

There was no hint of any initial breakthrough with the first round of closed-door talks stretching late into Tuesday evening as the parties agreed to resume the talks on Wednesday.

"We had a useful meeting today," said a Western official.

"Discussions took place this evening, (and) we are meeting again tomorrow," the official added. An Iranian source close to the talks also confirmed the negotiations would continue Wednesday.

The world powers are offering Iran permission to resume its gold and precious metals trade as well as some international banking activity which are currently under sanctions, Western officials told Agence France Presse.

But in exchange, Iran will have to limit sensitive uranium enrichment operations that the world powers fear could be used to make a nuclear bomb, the sources added.

"We have come here with a revised offer and we have come to engage with Iran in a meaningful way," EU foreign policy chief Catherine Ashton, who negotiates with Iran on behalf of the world powers, said in a statement.

Iran would have to stop enriching uranium to 20 percent and shut down its controversial Fordo plant where such activity occurs, a Western official said.

An Iranian source told AFP Tehran had come up with a counter-offer, whose final nature would be determined by terms posed by the big powers.

The source stressed "there was no question" of Tehran closing the Fordo plant where uranium is enriched to up to 20 percent -- a level seen as being within technical reach of weapons-grade matter.

But Iran could envisage halting the enrichment of uranium to 20 percent, if all international sanctions against it were dropped, including U.N. Security Council measures, the source said.

-- 'A diplomatic path' --

U.S. Secretary of State John Kerry, visiting Berlin, said there is a "diplomatic path" in the nuclear crisis and expressed hope that "Iran itself will make its choice to move down the path of a diplomatic solution."

The talks pit the world powers of Britain, China, France, Germany, Russia and the United States -- represented by Ashton -- against the Iranian team of top nuclear negotiator Saeed Jalili.

The talks are the first such encounter since a meeting in Moscow in June 2012 and Iranian officials have doused expectations by insisting they will offer no special concessions.

"It's clear that no one expects everyone to walk out of here in Almaty with a done deal. This is a negotiating process," said Ashton's spokesman Michael Mann.

Iran denies it is developing nuclear weapons and wants the world to respect its "right" to enrich uranium -- something current U.N. sanctions say it cannot do because of its refusal to cooperate with nuclear inspectors.

The Iranians went into the talks by issuing a string of comments suggesting they were willing to listen to offers without softening their own position.

"We will not accept anything beyond our obligations and will not accept anything less than our rights," Jalili declared before setting off for Kazakhstan.

Russian Deputy Foreign Minister Sergei Ryabkov said Moscow was hoping that the talks would now move into a phase of "bargaining" rather than just offering proposals.

"There needs to be a political will to move into that phase. We call on all participants not to lose any more time," he said, quoted by Russian news agencies.

The talks come with the lingering threat of Israel launching a unilateral strike on Iran just as it had done against the Osirak nuclear reactor in Saddam Hussein's Iraq in 1981.

Iran already has a nuclear power plant in the southern city of Bushehr -- built with Russian help -- but Iran's supreme leader Ayatollah Ali Khamenei has described atomic weapons as a "sin".