Iran will invite International Atomic Energy Agency Chief Muhammad al-Baradei to Tehran to discuss its nuclear programme, the country's official news agency reported on Monday.
"Iran is going to invite al-Baradei soon to visit Iran to hold talks to remove technical problems," IRNA quoted Iran's Supreme National Security Council secretary, General Hassan Rohani, as saying.
Rohani's comments came during a meeting with Straw, who is on a two-day visit to the country that began on Sunday.
Earlier in the day, Straw said Tehran should allow wider UN inspections to its nuclear programme or risk Iran’s trade relations with Europe.
Straw had told the BBC that “nobody knows for certain” whether Iran had nuclear weapons.
But he insisted that Britain would not agree under any circumstances to take military action against the Islamic republic.
“What we … are proposing is that they (the Iranians) have to sign up to what is called an additional protocol which provides for these more intrusive inspections,” Straw said.
The British foreign secretary said his country’s call was in conformity with similar ones by the international community.
He added that if Iranians failed to sign the protocol, they would “fail to make progress on a host of other issues on which they do want progress, for example, on a trade and cooperation agreement.”
During a meeting with Iranian Foreign Minister Kamal Kharazi, Straw pressed international calls for Iran to "unconditionally" allow wider UN inspections of its nuclear sites .
Kharazi, however, was defiant.
"When Iran is going to take positive steps, it is our right to expect positive steps from others," Kharazi said during a joint press conference.
"If we are going to sign new commitments, we need to know the implications," he said.
Iran has come under international pressure to sign an additional protocol to the Nuclear non-Proliferation Treaty (NPT).
The additional protocol allows UN inspectors to make surprise visits to any nuclear site in the country.
But Straw said that if Iran did not sign the additional protocol, "confidence will not be improved and the international community will be profoundly reluctant to lift sanctions".
Kharazi criticises Blair
Another point of contention related to the protests staged earlier this month by Iranian students.
Kharazi said Iran was "deeply unsatisfied" with remarks made by UK Prime Minister Tony Blair in support of the protesters.
"I would expect him (Blair) to make a distinction between peaceful students, who naturally have a right to demonstrate, and vandals who destroy public property," he said.
Kharazi said that most of the 50 students who were being held in prison were rioters.
"Nobody can support them, not even Jack Straw or Tony Blair."
Straw claimed that Blair's remarks were misinterpreted, saying that they were "not in any sense a gratuitous act of interference in Iran's affairs".
However, Straw made positive comments regarding Iran's conduct in post-war neighbouring Iraq.
"So far we have been broadly satisfied with the cooperation we have received," Straw said.
He did not echo US accusations that the Islamic republic was encouraging the majority Shia population in Iraq to reject US and British occupation there.
However, Straw said there were only "some concerns" over Iran's role in Iraq, following the collapse of the Iraqi regime in April.