By Fredrik Dahl
VIENNA (Reuters) - Iran and the U.N. nuclear watchdog are nearing a framework deal on how to tackle concerns about its atomic activity, diplomats say, a potential bargaining chip for Tehran in next week's negotiations with world powers.
Iran says such an agreement is needed before it can consider a request by U.N. inspectors to visit the Parchin military site where they believe explosives tests relevant for developing nuclear weapons may have been carried out.
The International Atomic Energy Agency (IAEA) and Iran held talks this week in Vienna and are due to meet again on May 21, two days before Tehran and the six global powers discuss the future of its disputed nuclear program in Baghdad.
Western diplomats accredited to the U.N. agency said Iran seemed keen to agree a so-called "structured approach" - an outline of how to deal with the IAEA's questions - ahead of Baghdad in the apparent hope of gaining leverage there.
They say they would welcome any sign that Iran is prepared to stop stonewalling an almost four-year-old IAEA investigation based on Western intelligence suggesting Iran has researched ways to acquire the ability to produce nuclear bombs.
But they caution that it remains to be seen whether an understanding with IAEA is implemented in practice, saying Iran in the past has used haggling over procedural matters as a way to buy more time as its nuclear program advances.
It would be "a step forward on the process side," one diplomat said about the possibility of an agreement to be announced on Monday, suggesting it would signal real progress "if it gets us to where we can finally address substance."
He said it would be a relatively brief document on the scope and principles of how to pursue talks regarding possible military dimensions to Iran's nuclear program: "No real details. Just a precursor to starting to ask real questions."
The U.N. nuclear watchdog, tasked with preventing the spread of nuclear weaponry in the world, has made it clear it will only sign up to something that would enable it to carry out its investigation without restrictions, and not "tie our hands".
Two previous rounds of talks in Tehran early this year failed to make any notable progress. But both sides were more upbeat after the May 14-15 meeting in the Austrian capital, raising hopes of a possible outcome when talks resume on Monday.
A non-Western envoy said: "Progress has been made. There are still one or two outstanding issues. My impression is that both sides have the willingness to move forward."
Iran denies having a covert atomic bomb agenda, saying it is enriching uranium only for a future network of civilian nuclear power stations and a medical isotope reactor.
(Editing by Mark Heinrich)