Speaking to the "Sunday Times"’s Marie Colvin, the defector, who worked at the Iranian section of the Mukhaberat (intelligence) headquarters in Baghdad, Saddam Hussein has stepped up operations against Iran, despite public diplomatic overtures.

The defector, who’s identity and rank has not been revealed, portrayed a Saddam "unchastened" by his 1991 defeat in the Gulf war, still plotting against his neighbours and able to import substantial weaponry despite an international embargo.

With Iraqi training and a supply of arms and explosives, the group has mounted a growing number of operations inside Iran.

The defector said Saddam had ordered Iraqi intelligence to encourage the Mujaheddin-e Khalq to attack armed forces and assassinate officials. Last Sunday the group shelled Mehran, a southern city, and in October mortar-attacked buildings in central Tehran two days running. One of the targets was the headquarters of the elite Republican Guards.

According to the defector, Saddam has also begun supporting other opposition groups among restive minorities in Iran, where most of the population is Persian and adheres to the Shi'ite branch of Islam.

The Iraqi support for these other groups, the defector said, was not just to undermine the regime in Tehran but also to dilute the strength of the Mujaheddin-e Khalq, the very group Saddam purports to back.

Outwardly Saddam has pretended to be seeking peace with Iran. In October Kamal Kharazi became the first Iranian foreign minister to visit Baghdad in 10 years. But behind the scenes there is no rapprochement. "We were told, "Ignore what you see in politics", the defector said.

Iraq was supposed to destroy its weapons of mass destruction after the Gulf war. However, the defector said, the mukhabarat had unlimited access to weapons needed for an assassination and guerrilla campaign in Iran: pistols with silencers, machine pistols, sniper rifles of low calibre, detonators with timing mechanisms and poison that could kill with one tablet.

While at the end of the war in 1991 the army had only 200,000 guns, it was now completely re-equipped with many times that number, he said.

Confirming the Sunday Times story, informed Iranian sources said not only the MKO has increased dramatically its operations inside Iran, but also against Iranian dissidents abroad who do not support them.

Western intelligence sources told Iran Press Service that "encouraged by Saddam’s new promises, the MKO has gone on the offensive both inside and outside Iran, attacking random targets in various Iranian cities and abroad, beating and intimidating influential Iranian personalities opposed to them", one source said.

Last week, Dr. Alireza Nurizadeh, a prominent Iranian journalist and writer based in London was badly attacked and wounded by a team of 14 MKO in the German city of Bremen, as he was to speak on the subject of "serial murder" of dissident Iranian politicians and intellectuals at the hands of high-ranking Iranian intelligence officers.

The attack led to wide protest against the MKO by the Iranian Diaspora calling on western government to check the activities of the terrorist organisation.