Formation of a national unity government in Baghdad has cleared the way for proposed direct talks between the United States and Iran about the situation inside Iraq, U.S. Ambassador Zalmay Khalilzad said in an interview with The Associated Press.

The Afghan-born, Farsi-speaking ambassador has been authorized to hold discussions with Iran. If the talks take place, they would amount to the most public bilateral exchanges by the countries since soon after the Iranian Revolution in 1979.

But the topic of the talks from the U.S. viewpoint is supposed to be an exchange of views on the situation in Iraq, rather than broader subjects like Iran's controversial nuclear program or Iran's renewed verbal hostility to Israel since President Mahmoud Ahmadinejad came to power last summer.

CountryWatch: Iran

In a shift from prior policy, Iran's conservative government this year announced willingness to begin a wide dialogue with the United States. Ahmadinejad also sent a lengthy letter to President Bush two weeks ago asking him to reconsider some U.S. foreign policies in light of Bush's religious beliefs.

The issue of dialogue has taken on greater urgency as the U.N. Security Council weighs possible sanctions against Iran for its decision to begin processing uranium in what the United States and the European Union suspect is a secret nuclear weapons program. Iran insists that its enrichment is for peaceful atomic purposes only.

In an interview Sunday in the U.S. Embassy Annex in Baghdad, Khalilzad said talks with Iran about Iraq could not have taken place earlier because the United States did not want to leave anyone under the impression that Iran and the United States "got together to decide the government in Iraq."

"But we have said publicly, and that remains our position, we'd be prepared to consider talking with them once the government of national unity is formed," he said. He declined to specify how talks might begin, saying only, "There are channels for communicating."

"We have a lot of issues to discuss with them with regard to our concerns and what we envision for Iraq, and be prepared to listen to their concerns," Khalilzad said.

High on the U.S. agenda, he said, would be alleged transfer of weapons from Iran into Iraq.

"We want good relations between Iraq and its neighbors, but we do not want Iran or others in the region to send arms to militias, to train militias, to send money to militias or others who want to undermine this new Iraq," he said. Arms and money from Iran do reach Iraqi militias now, he charged, "and we believe there are other negative actions that do take place by the Iranian regime in Iraq."

But Khalilzad also offered Iran some conciliatory words. Calling Iranians "a great people" with "a very accomplished history," Khalilzad said he has "no doubt" that there will one day be good state-to-state relations between the United States and Iran.

Asked if the official U.S. policy to Iran was "regime change" or "containment," Khalilzad said what the United States seeks is "behavior change."

"Ultimately the wishes of the Iranian people — who seek to live in a proud country, have normal relations with the world, relations of mutual respect with the world -- will impose itself on the country as a whole (and) on the government of that country," he predicted.