The United States and Europe urged Iran on Monday to use upcoming talks with world powers to ease international worry that it may be aiming to develop nuclear arms, but Tehran said such concerns were based on "fake evidence" concocted to cause it political and economic harm.

The statements at a 189-nation meeting looking for ways to strengthen the Nonproliferation Treaty reflected the divide over the Islamic Republic's nuclear activities. The divisions threaten the success of the talks with six world powers and a separate meeting between Iran and the U.N. nuclear agency.

Iran and the six come to the table in Baghdad on May 23 to build on admittedly meager progress made last month in Istanbul when the parties agreed there may be enough common ground to try and focus on specifics in Iraq. The United States, Russia, China, Britain, France and Germany will try to secure an Iranian pledge that it will curb its production of higher-enriched uranium, which can be turned into fissile warhead material within months.

Before that, Iran's chief envoy to the International Atomic Energy Agency meets May 13-14 with senior officials of the U.N. agency, which has long been trying to probe Tehran's atomic secrets. IAEA officials say they will use that encounter to press for renewed access to the Parchin military site to look for signs of covert work on a nuclear weapons program.

Tehran has denied that request as well as deflecting bids by the IAEA to interview scientists suspected of involvement in alleged covert research and development work into nuclear arms.

Both the United States and the European Union laid out Western expectations on Monday for the Baghdad meeting. They urged Tehran to comply with U.N. Security Council resolutions demanding an end to uranium enrichment and other activities that Iran says are for peaceful use but which can be turned toward weapons making.

"We remain concerned by Iran's persistent failure to comply with its nonproliferation obligations, including IAEA ... obligations and U.N. Security Council resolutions," U.S. chief delegate Robert A. Wood said.

Beyond expecting Iran "to take urgent practical steps" at the Baghdad talks that will diminish mistrust in its nuclear aims, Wood said the onus was on Tehran "to cooperate fully with the verification efforts of the IAEA."

"We are concerned that Iran has not agreed to grant the IAEA access to all relevant sites, information, documents and persons necessary to resolve questions about its nuclear program, including concerns about its possible military dimensions," he said.

The EU also urged Iran to compromise at both the Baghdad and Vienna meetings. In a statement to the Vienna conference it urged Iran to heed Security Council demands and "fully cooperate with the agency, in order to clarify all outstanding issues, in particular those which give rise to deep concerns about possible military dimensions to its nuclear program."

Iranian delegate Ali Asghar Soltanieh, however, dismissed talk of alleged secret nuclear weapons related work as based on "unreliable and fake evidence" -- and turned the tables.

He demanded compensation for the resulting "political and economic damages" suffered by Iran -- shorthand for sanctions that are isolating his country and most recently threatening its main cash cow: oil exports.

Both Europe and America are squeezing Iran's oil industry. An EU embargo on Iranian crude goes into effect in July and in New Delhi on Monday, U.S. Secretary of State Hillary Rodham Clinton called on India to join other nations and reduce its Iranian oil imports to keep up pressure on the Islamic republic.

Like other nations that do not fall into line, India could face U.S. sanctions by the end of June if Washington determines that it has not made significant cuts in Iranian oil imports.

Iran disputes that its activities violate the Nonproliferation Treaty and asserts it is a victim of unjustified embargoes of nuclear technology while nuclear weapons nations outside the treaty such as India and Israel have unfair access to hardware and know-how.

Soltanieh described an agreement between India and the supplier group of nuclear nations that allows transfers of such technology to New Delhi as "made under pressure exerted by the U.S. and supported by the EU."

"When a country outside the (Nonproliferation) Treaty easily and unconditionally enjoys nuclear assistance ... it will never have incentives to accede to the Treaty," he said, describing the deal as a "manifestation of double standards and discrimination."

He also accused the United States, Britain and France of supplying Israel with the knowledge and technology that allowed it to develop nuclear weapons. The Jewish state does not discuss its nuclear status, but is commonly considered to have such arms.

While the West considers Iran the greatest proliferation threat in the Mideast, Muslim nations say Israel's undeclared nuclear arsenal makes it the most ominous threat in the region.