The US says Iran is secretly trying to set up banks in countries around the world in order to skirt sanctions over its nuclear programme that have increasingly undermined Tehran's economy.

Economists are saying that sanctions on Iran seem to be having an impact, but a number of Iran's  trading partners could be feeling the pinch, as the West piles on the pressure to cut ties with Tehran.

In the United Arab Emirates, traditionally the biggest trading partner with Iran, companies are backing away from doing business with Tehran. But the embargo has dramatically hit their profits.

With countries following the sanctions and others dragging their feet, what impact are the sanctions having on the economies of Iran's trading partners? And are the sanctions designed to drag Iran back to the negotiating table?

Joining the programme are Sadegh Zibakalam, a professor of politics at Tehran University, Ibrahim Khayat, a strategist and business analyst, and Scott Lucas, the editor of EnduringAmerica.com, and a professor of US foreign policy at the University of Birmingham.

This episode of Inside Story aired from Thursday, October 21, 2010.