He also said that the Iranian people stood ready to defend their country in the event of any attempt to close down the nation's nuclear programme.

"Any finger that will trigger the bullet, the Iranian people will cut it," he told a press conference at the D8 summit of developing nations.

Ahmadinejad said the US was no longer in a position to make an assault on Iran.

"In the US, his wise scholars will not allow Mr. Bush to commit political suicide and of course the economic, political and military situation will not allow Mr. Bush to do that," he said.

"(Bush) is not in a situation to change circumstances in his favour."

The United States and its top regional ally Israel have never ruled out attacking Iran over its nuclear drive, which the West fears could be aimed at making nuclear weapons.

There has been concern an attack against Iran could be imminent after it emerged Israel had carried out manoeuvres in Greece that were effectively practice runs for a potential strike against Iranian nuclear facilities.

Ahmadinejad also called for US military bases across the world to be "eradicated".

"The greatest threat in the Middle East and to countries in the world is US intervention," he said. "The military bases in the whole world should be eradicated and removed."

The Iranian leader, who is embroiled in a wrangle with the West over Iran's nuclear enrichment programme, called on the major powers to "withdraw from animosity and hostile actions against us".

"Justice, peace and friendship is also to their benefit," he said, accusing the US of focusing on "propaganda and psychological warfare".

"We are doing our utmost efforts to provide security and peace at the world level. I assure you, and don't be worried, that there will be war in the future."

The Iranian leader reiterated that his country would not pull back from its nuclear ambitions and called on Washington to withdraw its troops from Iraq.

"No one in Iran will go back from our nuclear position," he said. "We want dialogue for the benefit of all sides but within the framework of law and justice."

"To rebuild confidence, the US must withdraw its forces from Iraq and allow the fate of the people of Iraq and regional countries to be written by the hands of their own people," he said.

An aide to supreme leader Ayatollah Ali Khamenei warned on Tuesday that Iran would "set on fire" Israel and the US navy in the Gulf as its first response to any American attack over its nuclear programme.

Iran has responded to an offer from world powers to end the nuclear crisis and diplomats are analysing what is said to be a complex answer from Tehran.

The offer from world powers proposes that Iran suspends uranium enrichment -- the process which they fear could be used to make a nuclear weapon -- in exchange for technological incentives.

But in the latest sign that Iran is not willing to compromise on the key question of enrichment, its envoy to London said world powers were "wasting their time" by insisting on the issue.

Iran rejects the Western accusations and insists its nuclear programme is aimed solely at generating energy for a growing population whose fossil fuel reserves will eventually run out.

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