"The EU condemns unreservedly President Ahmadinejad's call for the eradication of Israel and his denial of the Holocaust," said the conclusions, which were due to be adopted later on Friday. The summit is on in Brussels.

  

"The comments are wholly unacceptable and have no place in a civilised political debate."

  

Mahmoud Ahmadinejad unleashed a wave of condemnation from world leaders this week after he described the Holocaust as a myth and called for the state of Israel to be moved as far away as Alaska.

  

The EU leaders urged Tehran to "join the international consensus on the need of a two state solution to the Palestinian-Israeli conflict".

  

They also called for Iran "to support the search for peace between Israel and its neighbours and to end the support for groups which advocate or engage in acts of terrorism".

 

Growing alarm

  

Those remarks, which come after similar comments in recent months, have stoked growing alarm in Europe and added to concerns about Iran's nuclear ambitions.

  

Amid a long-running standoff with Tehran over its nuclear programme, EU leaders said time was running out for a diplomatic solution.

  

"The European Council is gravely concerned at Iran's failure to build confidence that its nuclear programme is exclusively peaceful," they said in conclusions of their summit , which focused primarily on the bloc's budget.

  

"While the EU continues to work for a diplomatic solution, the window of opportunity will not remain open indefinitely."

Draft resolution,
EU summit

"While the EU continues to work for a diplomatic solution, the window of opportunity will not remain open indefinitely."

  

There is a meeting between the EU and Iran next Wednesday in Vienna, but European and Western diplomats say there is little hope of progress in getting Tehran to abandon nuclear fuel work, which is raising concerns that it is seeking to make nuclear weapons.

 

Non-compliance

  

The International Atomic Energy Agency (IAEA), the UN's nuclear watchdog, has found Iran in non-compliance with the Non-Proliferation Treaty (NPT) for almost two decades of hidden nuclear activities, a finding that requires eventual referral to the Security Council, which can impose sanctions.

  

Last month, the IAEA put off taking Iran to the council after Britain, France and Germany - which have been leading the European diplomatic effort - agreed to give more time for new Russian diplomacy to work.

  

Iran insists that its nuclear programme is a peaceful effort to generate electricity and that it therefore has the right to enrich uranium on its territory.

  

Enrichment is a process required to make fuel for nuclear power reactors, but also the raw material for atom bombs.