The following is a transcribed excerpt from FOX News Sunday, Sept. 14, 2003.

TONY SNOW, FOX NEWS: Secretary of State Colin Powell is in Baghdad at this hour. He has been meeting with key Iraqi leaders — members of the Coalition Provisional Authority (searchand the Iraqi government authority.

Powell met Saturday in Geneva with the foreign ministers of China, France, Great Britain and Russia, the other four permanent members of the U.N. Security Council. The topic, getting more international help rebuilding Iraq. The secretary acknowledged disagreements, particularly with the French, but also expressed hope the group soon would reach a consensus on how best to proceed.

Israeli Deputy Prime Minister Ehud Olmert, a close confidante of Prime Minister Ariel Sharon, says Israel should not rule out killing Yasser Arafat. Earlier this week, Israel's cabinet adopted a resolution that called Arafat an obstacle to peace and advocated his removal, but did not specify what actions might achieve that goal.

Former President Bill Clinton appeared in Iowa Saturday with most of the Democrats running for his old job. He praised the field as the best in a decade. He also criticized President Bush for turning his narrow election victory into what Clinton called a mandate for radical change.

The Bush administration wants to broaden the effort to stabilize Iraq and hopes a U.N. Security Council resolution will do the trick. Joining us to discuss this and much more, Secretary of State Colin Powell, live from Baghdad.

Secretary Powell, what do you want out of a U.N. resolution?

COLIN POWELL, SECRETARY OF STATE: We're looking for a U.N. resolution that would give a broader political mandate to the international efforts to help the Iraqi people. And through that broader political mandate, perhaps encourage other companies to — other countries to contribute troops to the 30 countries that have troops here now. And might encourage people to be forthcoming at the donors conference for Iraq that will be held in Madrid next month.

And to show a sign of encouragement to the Iraqi people that the international people is going to do everything it can to help the Iraqi people build a better country.

SNOW: Are you confident that a resolution will be agreed upon by the meeting of the U.N. General Assembly later this month?

POWELL: Well, there will be the Security Council that does the voting on the resolution in due course. And I've gotten a pretty good response from most of the 15 members of the Security Council, including the United States of course.

But we're working with some countries that have differences of opinion on certain aspects of the resolution, and the discussions now will return to New York, where our permanent representatives will continue the debate.

This is all part of resolution making, and none of it — none of what has been going on the last few days surprises me.

SNOW: The French seem to want some guarantee of a date certain when Iraqis take over control of the government. Do you think it is possible to offer such an assurance, and do you simply think that the French timetable is too narrow, too short?

POWELL: Well, we are going to ask, through this resolution, the Iraqi Governing Council to come up with a plan for transition back to full authority in the hands of Iraqis and what timetable they think is appropriate. And we're going to ask them to work that out, working with the Coalition Provisional Authority and the United Nations secretary general's representative here. It seems to me that's the way to go about it, not to put in (inaudible) arbitrary dates.

The French suggested a rapid turnover — sometime within the next month or so. But that's not practical. We all know that the Governing Council and the brand-new Iraqi ministries are not yet ready to handle that responsibility.

And so what we have to do is work with them, grow them, build them, and we're off to a good start. I met with the new Iraqi foreign minister today. I met with the Governing Council. Ambassador Bremer is meeting with each of the individual ministers who have been appointed. They recently declared, in the last 24 hours, that they would have an independent judiciary. A new economic plan is coming forward.

All sorts of things are happening over here in Iraq, and especially here in Baghdad, Tony. You kind of have to get away from Washington to see the good things and not just the headline that screams for attention.

SNOW: Well, give me your impression of how things are going in Baghdad right now and in Iraq generally.

POWELL: You'll have to repeat that, Tony. A bunch of helicopters were taking off.

SNOW: OK. Secretary Powell, give me your impression of how things are going in Iraq and, specifically, in Baghdad.

POWELL: In Baghdad, if you fly in from the airport, as I did today, things look relatively calm and normal. And with each passing day, there's more traffic on the street, there's more commerce starting up. The electrical power is slowly approaching pre-war levels and will exceed pre-war levels before the fall is out.

There is still a security problem in Baghdad and throughout the country. We know that. And this security threat comes from those who do not want to see Saddam Hussein go and those who want to foment trouble here, terrorists who are coming in, as well as remnants of the old regime.

I had a long meeting with our military commanders here, and they are confident they can deal with these remnants of the old regime, but it will take time. But they're hard at work on it.

With respect to the terrorists coming in, that's a different kind of threat. But they're hard at work on that threat as well.

So this is still a dangerous environment. And one of the ways to deal with this danger is to bring up as quickly as we can Iraqi police forces and a new Iraqi army. And we're hard at work on that as well.

Ultimately, security has to be in the hands of Iraqi police, Iraqi military, Iraqi border patrols, and the Iraqi judiciary.

SNOW: U.S. Central Command (search is saying that we don't need extra troops. How soon do you think it will be possible to start withdrawing American troops and handing over duties to Iraqi forces?

POWELL: Well, I'd rather let Central Command make that judgment. What they have said is they don't need any more U.S. troops, but, of course, we're still encouraging troops of other nations to join the coalition effort.

And we know there are some 14 countries that are examining that idea to see whether or not they can make a contribution and whether it works for their domestic political situation.

SNOW: Do we want troops from other countries because we need the manpower, or because we want to, at least in the public perception, de-Americanize the operation?

POWELL: Well, we certainly want to put an Iraqi face on the operation as quickly as we can. Our troop levels will remain fairly constant for a period of time, until the rotations begin early next year.

We want more troops in from other nations because the more troops you have, the quicker you can bring security throughout the country and you can get the reconstruction going on a safe and secure basis.

So it's not just a matter we want more outsiders for the sake of having more outsiders or foreigners or to reduce the American presence, but really to help us create a more stable, secure environment throughout the country.

The whole country is not in an uproar. The south is relatively stable, the north is relatively stable. The real difficulty is in the central triangle, as we call it, around Baghdad and north of Baghdad. That's where we're having the most trouble.

SNOW: It sounds, though, like you agree with Senator John McCain and others who believe that there need to be more forces, whether they're American or international. We need more troops in Iraq to finish the job quickly and properly.

POWELL: We would welcome more troops, and that's been clear. That's why we have gone out to the other nations. But keep in mind, some 30 nations are here now. Let's not talk about this only being an American operation. There are some 22,700 troops from these other 29 nations who are here standing alongside of us because they are committed to the same effort.

And we're trying to get more nations involved. The more troops you have, the more you can demonstrate presence throughout the country and the greater density you can achieve.

But, you know, U.S. forces are especially good, not at just stationary watch or guarding things, but going out after the remnants of the regime. And more and more, our troops are doing that with multiple raids, going out into the countryside, using the intelligence we're gathering to go after these remnant elements who really would like to see a return of Saddam Hussein, and that is not going to happen.

Instead, the people of the world are going to see an Iraqi government that has now started to develop and that will grow as time passes and become more and more effective and will take on more and more responsibilities.

They are in the process now of forming a group to write a constitution, and from that constitution elections will flow. And from those elections, we will have new leadership.

And at that time, the Coalition Provisional Authority will be very happy to transfer full authority for this new country, this brand-new country, really, to the elected leadership of that country, a country that will live in peace with its neighbors and in security for its people.

SNOW: Do you expect that within a year?

POWELL: I can't predict that. Ambassador Bremer has an aggressive schedule. We'll have to see how quickly it takes them to put together a constitution. And they're working on that now, but I wouldn't want to speculate on what time line they come up with for the completion of that work.

SNOW: All right. Secretary Powell, is Yasser Arafat an obstacle to peace?

POWELL: Yasser Arafat, we believe, has not been helpful to peace, and that's why we would not deal anymore with him after the president gave his speech of June 24th of last year.

And that's why we believe it's very important for the Palestinian people to be represented by a prime minister, elected by their legislature, and with all the power of a prime minister, and with all the security and military and paramilitary assets of the Palestinian people so that that prime minister can go after terror.

Until we get rid of terrorist activity and terrorist organizations such as Hamas, which continue to use terror as a political weapon to kill innocent people and destroy the dreams of the Palestinian people for their own state — until we do that — it has to be done by the Palestinians — we are going to have difficulty moving forward on the road map.

So I hope that the prime minister-designate will get the authority he needs, political authority, and resources he needs to take on this challenge.

SNOW: Do you see any sign that Yasser Arafat is going to hand over security-force power to anybody? He certainly did not do it with Abu Mazen, and it doesn't look like he's going to do it with Abu Ala either.

POWELL: He didn't do it with Abu Mazen, and we saw the results. If the Palestinian people want to see progress toward their state, if the Palestinian people want peace for themselves and for their children, it's time to turn away from terror as a political tool.

And the way to do that is to insist that all of the assets of the Palestinian Authority, all the security assets, go under the supervision and control of one man, the prime minister.

SNOW: Secretary Powell, Israel has defined Yasser Arafat as an obstacle to peace and has advocated his removal. What specifically would be the negative consequences of exiling Yasser Arafat?

POWELL: The United States does not support either the elimination of him or the exile of Mr. Arafat. It's not our position, hasn't been. The Israeli government knows it.

And I think the consequences would not be good ones. I think you can anticipate that there would be rage throughout the Arab world, the Muslim world, and in many other parts of the world. And I don't see how, at this delicate moment, that would serve the cause of moving forward on the road map.

SNOW: So, Ehud Olmert says killing is an option of Arafat. You absolutely say that's not true.

POWELL: The Israelis know our position quite well. There are many people in Israeli political life who make statements with respect to their position.

SNOW: Do you think that statement made things worse?

POWELL: Well, I don't think it was helpful.

SNOW: You mentioned the fact that you fear rage in the streets. Now we have heard this before, principally when Yasser Arafat was contained in Ramallah. In fact, when the Israeli siege was lifted, people threw rocks at him, so that there was not, in fact, rage, at the targeting of Yasser Arafat.

Do you know of any leader in that region who thinks that the region would be worse off with Yasser Arafat — without Yasser Arafat?

POWELL: The question is how Mr. Arafat departs from the scene. And if he departs from the scene as a result of Israeli action, I do not think that would help the road-map process.

SNOW: Do you believe — we've talked about Yasser Arafat. He's clearly in charge right now. We're not dealing with him. Now there are two options, either he is removed from the equation, or we have to deal with him.

How can we possibly proceed on the road map to peace without acknowledging the simple and plain fact that Yasser Arafat is the guy in charge right now?

POWELL: We didn't deal with him for a year, and they finally realized, well, a little less than a year after we said we wouldn't deal with him, they realized that they had to find an alternative. And they did. They created the position of prime minister. The man was nominated by Mr. Arafat. He was approved by the Palestinian legislature. But he wasn't given the full power of the office, what was needed to be done.

And Yasser Arafat was part of the problem. And the Palestinian people have to take responsibility for not empowering their own prime minister.

But we will not deal with Yasser Arafat. And we are hoping that the prime minister-designate or whoever takes over the reins of prime minister will take it over with political authority to act against terrorist organizations and with the tools necessary — all the security organizations within the Palestinian Authority.

SNOW: The International Atomic Energy Agency (search has given Iran until Halloween, October 31st, to make a full accounting of its nuclear programs. Iran says it's not inclined to comply. If it doesn't, what happens?

POWELL: Well, if it doesn't, then it's a matter that will be put before the Security Council for action the Security Council might deem appropriate.

But I wouldn't prejudge that until we see what Iran does after it reflects on what it is now facing, which is the will of the international community coming together to say, "You have violated your obligations, and it is time for you to sign additional protocols and satisfy the international community that you are not developing programs for nuclear weapons."

SNOW: Is Iran holding Al Qaeda leaders?

POWELL: I'm sorry, I can't hear you, Tony. Say it again.

SNOW: Is Iran holding Al Qaeda leaders?

POWELL: We believe there are Al Qaeda leaders in Iran, Al Qaeda personnel.

SNOW: And is Iran offering aid and comfort, is Iran assisting them in their activities?

POWELL: We know that they have detained some. I don't know that they have control of all.

SNOW: All right. The secretary of state, Colin Powell, thanks for joining us today.