Inspectors catch Iran developing technology to produce a nuclear bomb

Iran has been caught secretly developing the technology to produce a nuclear bomb, The Independent can reveal.

It has been forced to admit producing plutonium - the material associated with nuclear arms - after concealing its nuclear weapons programme from UN inspectors until last month, according to a confidential report by the International Atomic Energy Agency (IAEA).

The findings will be welcomed by the Bush administration, which has branded Iran part of an "axis of evil" and has long accused it of secretly developing nuclear weapons.

The 29-page IAEA report, obtained by The Independent, concludes that "while most of the breaches identified to date have involved limited quantities of nuclear material, they have dealt with the most sensitive aspects of the nuclear fuel cycle, including enrichment and reprocessing". While the inspectors found no evidence that Iran had produced a nuclear weapon, they discovered it had covertly produced small amounts of plutonium in laboratory conditions.

"Fat Man", the bomb that destroyed Nagasaki and killed 70,000 people, had a plutonium core no bigger than a football and weighed 22lb (10kg).

The West fears that Iran's obtaining of nuclear weapons would further destabilise the Middle East. Israel is believed to possess at least 200 nuclear warheads. Iran has uranium mines, which it has activated for what it says is a civil nuclear programme.

The IAEA report says Iran's nuclear programme consists of "a practically complete front-end of a nuclear fuel cycle", including uranium conversion and enrichment. It criticises Iran for failing to volunteer information about its nuclear material, its processing and use, as well as its nuclear- related facilities, "in a number of instances over an extended period of time".

Iran came clean only as it faced the threat of UN sanctions, and after three EU ministers flew to Tehran last month to wring a pledge from the hardline leadership that it would agree to more intrusive IAEA inspections.

The crisis began when the IAEA found traces of uranium-enriched material at the Natanz nuclear plant this year. In its latest report, it expressed "serious concerns" at Iran's deception of the inspectors.

Michael Levi of the Brookings Institution in Washington said: "This is a big deal. There has been systematic deception over a length of time. The only difference between a process to make fissile material and a process to make nuclear weapons is a policy decision. IAEA inspectors cannot look inside the heads of the Iranian rulers."

Iran tried to play down the importance of the findings. Ali Akbar Salehi, Iran's representative to the IAEA, said: "The failures attributed to Iran are insignificant and are at the level of gram and microgram of nuclear materials." But a senior diplomat said: "The US, the UK, France, India and Pakistan all started out with laboratory- scale activities.

"That was their weapons programme until they set one off in the desert or on an island."

The IAEA said it would be unable to say for some time whether Iran's claim that the plutonium was for energy production was credible.