The US is offering to break a decades-old taboo and negotiate a civil nuclear deal with Russia - a move largely intended as an incentive for Moscow to throw its full weight behind Western efforts to prevent Iran obtaining nuclear weapons.
Talks are still at an early stage, officials say, and details are unlikely to be unveiled at this weekend's G8 summit in St Petersburg, hosted by President Vladimir Putin. If completed, however, a deal could see Russia earning billions of dollars as a leading storage centre for spent nuclear fuel from US-built reactors.
The discussions, first disclosed by The Washington Post on Saturday, should help smooth ties between America and its one-time superpower rival ruffled by US accusations of a clampdown on democracy and free speech by Mr Putin, and by anger over Moscow's unwillingness to back punitive sanctions against Iran and North Korea.
But they are bound to generate controversy in the US, where some conservatives were already calling on President Bush to boycott the St Petersburg meeting as a sign of his displeasure. The environmental lobby, deeply worried about nuclear safety standards in Russia, will also protest.
Iran is likely to top the G8 agenda when the leaders gather on Saturday, amid growing impatience over Tehran's apparent stalling over its response to the package of incentives offered by European negotiators to persuade the Islamic regime to abandon its uranium enrichment activities - which the West suspects are aimed at developing a nuclear bomb.
Russia has refused to back either sanctions, or a strong United Nations Security Council resolution that could pave the way for US military strikes. But the Bush administration believes a lucrative civilian deal will make Moscow more amenable. The latest moves could revive an earlier Russian offer to conduct uranium enrichment for Iran inside Russia - a proposal which has drawn mixed reactions from Tehran.
Yesterday, however, Iran warned the G8 not to take any decisions on its nuclear programme, arguing that this could jeopardise the current negotiations with the European Union, which are supported by the US.
Any "premature and incomplete" summit decision "could harm the positive trend of negotiations", Manouchehr Mottaki, the Iranian Foreign Minister, said.
* India test-fired its nuclear-capable Agni III missile yesterday for the first time, the Defence Ministry said. The launch of India's longest-range missile, able to fly1,900 miles, was said to be a routine test.Reuse content