Sir John Sawers, Britain's current ambassador to the United Nations, told the BBC that Iranian officials had privately admitted their role in supporting insurgents' roadside bomb attacks on British and US troops.

But the proposed deal, floated in teatime meetings at London hotels, was rejected by the British government.

It was not clear exactly when the deal was suggested, according to pre-released extracts of the interview, which will appear in a documentary later Saturday.

"The Iranians wanted to be able to strike a deal whereby they stopped killing our forces in Iraq in return for them being allowed to carry on with their nuclear programme," Sawers told the BBC.

He paraphrased the terms of the proposed deal as: "'We stop killing you in Iraq, stop undermining the political process there, you allow us to carry on with our nuclear programme without let or hindrance'."

It was proposed in a series of meetings between Iranian and European officials, he added.

"There were various Iranians who would come to London and suggest we have tea in some hotel or other," Sawers told the broadcaster.

"They'd do the same in Paris, they'd do the same in Berlin, and then we'd compare notes among the three of us."

Iranian foreign ministry spokesman Hassan Ghashghavi was quoted by the Mehr news agency as saying in response that the country's authorities "have many times stressed that Iran has no role in attacks on American and British troops."

"The Islamic Republic of Iran from the beginning of the wars in Afghanistan and Iraq has played a role for the return of peace, stability and calm in these countries," he said.

"It had regular dialogues and cooperation with international forces with regard to these issues."

The revelation is one of several in the documentary about backroom talks between the West and Iran since 2001.

Quoting Iranian and American officials, the programme also says Tehran cooperated closely with the United States to oust the Taliban in Afghanistan after the September 11, 2001 attacks, even providing intelligence information to help with bombing raids.

Hillary Mann, a former senior official under ex-president George W. Bush, told the BBC how one Iranian military official "unfurled the map on the table and started to point to targets that the US needed to focus on."

Iran's then president Mohammad Khatami was reportedly willing to help get rid of Iraqi leader Saddam Hussein, saying he was also Iran's enemy.

But relations reportedly soured when Bush labelled Iran part of the "axis of evil" in 2002.

The former third-highest ranking official at the US State Department, Nicholas Burns, told the documentary: "We had a very threatening posture towards Iran for a number of years. It didn't produce any movement whatsoever."

earlier related report
Iran tells Schroeder 'impossible' to stop nuclear plan
Iran's parliamentary speaker Ali Larijani on Saturday told former German chancellor Gerhard Schroeder that it is impossible to deprive Tehran of nuclear technology for peaceful uses.

"Iran has observed international regulations and depriving Iran of nuclear technology and energy for peaceful purposes is impossible," Larijani told Schroeder during a meeting in Tehran, according to state broadcaster.

The latest remarks by Larijani, a former nuclear negotiator for Iran, came after the International Atomic Energy Agency on Thursday said Iran is continuing to enrich uranium, potentially a stage in making an atomic bomb, but has slowed down the expansion of its enrichment activities.

Tehran and Western powers are at loggerheads over Iran's controversial nuclear programme. The West suspects the programme is aimed at acquiring atomic weapons, a charge Tehran denies.

Schroeder, who is on an unofficial visit to Iran, met top officials of the Islamic republic, including hardline President Mahmoud Ahmadinejad.

During his meeting with Larijani, the former chancellor praised Iran's "positive and constructive role in Afghanistan".

Later during a meeting with former Iranian president Akber Hashemi Rafsanjani, he said that without "US and Iran cooperating" current regional issues will not be solved.

Schroeder also said it was wrong to have ignored and isolated Palestinian Islamist militant group, Hamas, over the past years while solving the regional issues.

"It is necessary to have this group join regional solutions," he said.

In January, Israel fought a 22-day war with the Islamist movement in the Gaza Strip.

Israel has long accused Iran of arming the Islamists in Gaza, a claim Tehran denies even though it says it offers moral support to Hamas.

Iran and in particular Ahmadinejad have repeatedly launched tirades against Israel and even termed the Holocaust as a "myth", much to the fury of the global powers.

In a speech earlier on Saturday at the Iranian Chamber of Commerce and Industry, Schroeder criticised Ahmadinejad for doubting the Holocaust.

The Holocaust is a "historical fact" and there is no sense in denying such an "unparalleled crime," he said.

Borna news agency, an affiliate of the state-run IRNA news agency, said Schroeder criticised Ahmadinejad who has stirred global outrage with his anti-Israel stance.

The report said Schroeder emphasised that if Iran wants to be recognised as a regional and international power, it should assume some responsibility and respect international law.

But the former German leader also said Iran has an opportunity to ease tensions with the West.

"With the new US administration there is a chance of having a multilateral approach, not only with the Islamic world but with everybody... That is a good opportunity for Iran," Mehr news agency quoted him as saying in his speech.

Ahmadinejad too told Schroeder that the current issues "should be resolved with global cooperation and harmony," the state broadcaster said.

During his presidential campaign, Obama called for dialogue with Iran. That was a clear shift from previous president George W. Bush, who rejected talks unless Iran halted uranium enrichment, which makes fuel for nuclear power plants but can also be used for the core of an atomic bomb.

Last month, Obama said "if countries like Iran are willing to unclench their fists, they will find an extended hand from us."

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