"By updating last year's package, the Islamic republic is announcing its readiness for constructive dialogue and interaction," local news agencies quoted chief nuclear negotiator Said Jalili as saying.

But he added that Iran would not halt its nuclear programme, which Western governments fear could be cover for efforts to build an atomic bomb, something Iran strongly denies.

"The Islamic republic will continue its nuclear activities in an active interaction with the International Atomic Energy Agency (IAEA), within the framework of the Non-Proliferation Treaty and its regulations like other members."

Ahmadinejad said last week he would present a new package for negotiations aimed at resolving the nuclear standoff, after the so-called P5+1 group of world powers called for for dialogue with Iran.

"The Islamic republic... believes that the existing problems in the international arena must be solved through dialogue," Jalili said.

Last week, Ahmadinejad said Iran's package of proposals would be presented to the P5+1 -- UN Security Council veto-wielding permanent members Britain, China, France, Russia and the United States, plus Germany.

He said the package was a new version of proposals offered by Iran in May 2008, which proposed the formation of consortiums to enrich uranium and manufacture nuclear fuel, including one in Iran.

But Jalali took aim at the demands of the world powers, saying they recalled an approach "that tried to use the language of force and threat, instead of mutual respect for nations mutually.

"This approach has proved its ineffectiveness," Jalili said.

A statement from the P5+1 on April 8 recognised Iran's right to a civilian nuclear programme, "but with that comes the responsibility to restore confidence in the exclusively peaceful nature of its nuclear activities."

The group said it was determined "to resolve our shared concerns about Iran's nuclear programme in line with the package proposals for cooperation with Iran and in the context of our dual-track strategy."

Jalili rejected the dual-track approach as a move "against mutual respect."

"(The Iranian nation) takes it as an insult and considers it contrary to the interest expressed (by the world powers) in their statement," Jalili said.

IAEA chief Mohamed ElBaradei said on Monday he was optimistic about efforts to end the standoff over Iran's nuclear drive in the light of positive moves by both Tehran and Washington.

"I am extremely pleased with the reversal in the policy of the United States from one of confrontation to one of dialogue and mutual respect," he said.

Iranian Foreign Minister Monouchehr Mottaki is due in Brussels on Thursday for an international conference on Somalia which will also be attended by EU foreign policy chief Javier Solana. EU officials said no separate meeting had been scheduled between the two men but would not rule one out.

Tehran has been slapped with three sets of UN Security Council sanctions for failing to meet demands to suspend uranium enrichment, the process which makes nuclear fuel but also the core of an atomic bomb.

Ahmadinejad said at a press conference in Geneva on Monday that he welcomed the "necessary" shift in US policy towards Tehran after three decades of severed ties, but that he was awaiting "practical changes."

And US President Barack Obama vowed on Tuesday that he would not be deflected from his policy of "tough" direct diplomacy with Iran despite the latest anti-Israel tirade by Ahmadinejad at a UN meeting in Geneva.

"We will continue to pursue the possibility of improved relations and a resolution to some of the critical issues in which there have been differences, particularly around the nuclear issue," Obama said.

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