The United States must drop its "cowboy" attitude if it wants to hold dialogue with Iran over its nuclear programme, President Mahmoud Ahmadinejad said on Monday.

"We are for negotiations, but to do so you have to sit down like a good boy," Ahmadinejad said, referring to the United States, in a speech broadcast live on state television.

"They adopt a resolution to force a dialogue, but this cowboy logic has no place in Iran."

World powers led by the US voted for new UN sanctions against Iran on June 9 in a bid to force it to stop its nuclear programme which they suspect is aimed at making weapons. Iran denies its atomic drive has military aims.

Following up on the UN sanctions, US President Barack Obama on July 1 imposed Washington's toughest-ever unilateral punitive measures against Iran.

Ahmadinejad said Washington's real concern was not that Iran may make an atom bomb but that Tehran is fast rising as a regional power.

"They say we have intelligence that Iranians will most likely build one atomic bomb. Well, this is a lie, but let's say it is true. How many atomic bombs do you have?" the hardliner said in his speech, delivered in the northern city of Qazvin.

"The Americans themselves say 5,000 plus... Is someone who has 5,000 fourth and fifth generation atomic bombs, with very advanced launchers, afraid of one bomb? They are not afraid of one, not of a hundred, not of a thousand (bombs). They are afraid of the collective awakening of the Iranian soul."

Displaying his trademark defiance, Ahmadinejad vowed that Iran would not back away from its uranium enrichment programme.

Washington, he charged, knew full well that Iran is "not after an atomic bomb," despite its claims to the contrary.

"You sanction our banks and some products and think that we will back down and hand over the key to the Iranian nation," he said.

"They should know that they will take their dream of forcing down the Iranian nation to their graves. Our nation is one family... we may have different views, but we are one body against you."

World powers, immediately after the UN sanctions measure was passed, called for dialogue with Iran as part of its dual track strategy of imposing punitive measures and at the same time offering to hold talks.

But Ahmadinejad has ordered a freeze in talks at least until end of August as a "penalty" against world powers for imposing sanctions on Tehran.

earlier related report
In Germany, bad bank helps Iran
Hamburg, Germany (UPI) Jul 19, 2010 - In a bid to go around Western sanctions, Iran is using a small bank in Germany to do business on behalf of the regime's blacklisted companies, Western officials say.

The Wall Street Journal reports that the Iranian-owned European-Iranian Trade Bank from Hamburg has conducted more than $1 billion worth of business for Iranian firms linked to the country's alleged nuclear weapons program.

They include units of an Iranian defense procurement company, the Aerospace Industries Organization and the infamous Revolutionary Guard Corps -- entities sanctioned by the United States, the United Nations and the European Union, the newspaper writes, citing unnamed Western officials.

They told the paper that EIH Bank last year did business on behalf of Iran's broadly sanctioned Sepah Bank, which has been accused of being involved in weapons trade for Iran.

While EIH Bank is blacklisted by the U.S. Treasury, it isn't by the United Nations; therefore, the German banking oversight agency Bafin hasn't restricted business of the small institution.

That could soon change. A spokesman for the German Economics Ministry told the newspaper that European authorities are investigating whether to blacklist additional banks that have in the past months increased their business with Iranian firms.

The news about the Hamburg bank will only increase Washington's concerns about German-Iranian finance and trade links.

Germany remains the Islamic republic's largest trading partner in Europe. In the first four months of this year, trade grew to $1.8 billion, up 20 percent from the same period last year, numbers from the German-Iranian Chamber of Commerce in Hamburg indicate. Washington has urged its European allies to cut back on trade with the Islamic Republic.

German Chancellor Angela Merkel has relayed the message to companies but the Germans are concerned that competitors from Asia simply pick up the abandoned contracts -- resulting in a painful shift of business that would result in little additional pressure on the regime.

Iran denies Western allegations that its nuclear program is aimed at building nuclear weapons, vowing instead that it is for civil and energy purposes only.

The conflict has been going on for years; the West has in the past imposed an ever tighter web of U.N.-mandated sanctions in bid to force Iran to halt nuclear enrichment and cooperate with the West. Tehran argues it has the right to pursue nuclear energy independent from international oversight.

Meanwhile, an exiled Iranian opposition group eager to see the Iranian regime overthrown but designated a terrorist organization by the United States scored a victory in a Washington appeals court.

The U.S. Court of Appeals for the District of Columbia recently decided that the State Department must review its designation of the People's Mujahedin Organization of Iran as a foreign terrorist organization. In its 22-page verdict, the judges said the State Department has failed to give the group a fair chance to overturn the listing.

The State Department has upheld the terrorist label for the PMOI several times since 1997 -- most recently last year, citing classified information it has gathered against the group, arguing it was still dangerous.

The PMOI was founded in 1965 in opposition to the shah but was squashed by the mullah regime that took power in 1979. Its remaining members living in a camp in Iraq were disarmed by U.S. forces after the U.S.-led Iraq war, but its broad support with Iranian expatriates in Europe means that it remains one of the main opposition groups to the current regime in Tehran.

"It is totally unreasonable to keep them on the list at this point," Andrew Frey, a partner at Mayer Brown law firm and one of the PMOI's lawyers, told the Legal Times. "The PMOI stands for a democratic, secular, non-nuclear Iran. They stand for everything we'd like to see in Iran."

The European Union removed the PMOI from its terror list in 2009, a year after Britain did so. The German interior security agency Verfassungsschutz this year stopped mentioning the organization in its yearly report, after having monitored it for the past years.