The IAEA report stated Iran was being more transparent about its nuclear programme and many of its past nuclear issues have been resolved, but was not doing enough to clear up all suspicions.

 

'Victory over West'

 

Ahmadinejad described the UN watchdog report as a "victory over the West" which has accused Tehran of seeking nuclear weapons. 

 

"The best way for them [the US and its allies] to compensate for their mistakes ... [is] to apologise and pay compensation," Ahmadinejad said in a televised address to the nation.

 

"If they continue [to pursue sanctions], we have definitely drawn up reciprocal measures," he said, without elaborating.

 

The five permanent members of the UN Security Council and Germany have agreed on a draft resolution for a third round of sanctions against Iran for its refusal to suspend uranium enrichment.

 

Condoleezza Rice, the US secretary of state, said on Friday that the IAEA report strengthened the push for additional sanctions because it said Tehran failed to co-operate fully with investigators and left unanswered crucial questions about its nuclear past.