By Kenneth R. Timmerman *

WASHINGTON 17 Mar. (IPS) A top advisor to President Bush for Afghanistan told the American-Iranian Council (AIC), a pro-Iranian government lobby, that Iran is sheltering "Al Qa’eda" terrorists and continues to support other international terrorist groups, despite explicit U.S. requests to stop.

Afghan-born Zalmay Khalilzad, who recently returned from his native Afghanistan, delivered a blistering condemnation of the Iranian regime in a speech Wednesday night to the group in Washington DC that clearly had been hoping to hear a different message.

The AIC claimed that major U.S. corporations, including Chevron Texaco, CONOCO, and Exxon Mobil were "co-sponsors" of the one-day conference, but most of the hundred-odd participants gathering at the U.S. Chamber of commerce were Iranian.

"We had hoped that after the 11 September attacks, the Iranian regime would end its support for terrorists", Mr. Khaliazad said. "But Iran did not stop its support for terror. Indeed, the hard-line elements of the Iranian regime facilitated the movement of Al-Qa’eda terrorists escaping from Afghanistan".

For months, Iran was insisting that American allegations that members of the Al-Qa’eda and the defeated Taleban are in Iran are "baseless" and "undocumented".

But after Mr. Khalilzad disclosed that he had passed on information to Iranian diplomats, an unidentified "intelligence" source suddenly appeared at the leader-controlled television to confirm that at least 150 Arabs, Afghans and some Europeans suspected to be members of Al-Qa’eda and Taleban had been detained at Iran-Pakistan borders.

Washington also accuses Iran to send professional saboteurs, money and weapons to local Afghan commanders in the Western province of Heart in order to destabilise the interim government of Mr. Hamed Karzai.

Mr. Khaliazad warned that the Iranian regime was "aggressively pursuing" nuclear, chemical, biological and ballistic missile programs, which coupled to Iran's support for terrorism, created "a threatening mix".

"It is a particularly dangerous prospect for an Iranian government, not accountable to the Iranian people and supporting terrorists, to acquire nuclear weapons", he added.

Blasting the Islamic Republic for its human rights abuses and repression of women, the American Envoy assured that America "will stand beside all people, – including Iranians – who seek a freer future".

"Nearly 65% of Iran's population is under 25. This group has been the driving force for change. But the voices and protests of Iran's young people have been repressed – at times violently", Mr. Khalilzad further noted.

But Khaliazad pointed out that the Iranian government has chosen "not to engage the United States in a dialogue free of preconditions."

The Iranian government and major U.S. corporations seeking to remove U.S. trade sanctions on Iran finance the American-Iranian Council jointly. The group, which is chaired by Dr. Hooshang Amirahmadi, regularly calls for a "dialogue" between the U.S. and the clerical regime in Tehran, with the clear suggestion that the roadblocks to dialogue are in Washington.

It was at this one-day conference that Senator Joseph Biden (D, DE) suggested a meeting between Iranian and American lawmakers.

"If there is any problem for them to come to Washington, we can meet somewhere else", the Chairman of the Senate Foreign Affairs Committee added.

The proposal split both conservative and reformist camps in the Iranian leadership in groups favouring or rejecting the invitation, as it was formulated after President George W. Bush characterised the Islamic Republic as an "evil State", alongside Iraq and North Korea.

"I believe than an improved relationship with Iran is in the naked self-interest of the United States of America", Mr. Biden told the gathering.

However, he also criticised the regime for its support of terrorism and human rights abuses, stating: "we are squarely with the Iranian people in their desire for a democratic government and a democratic society".

The senator was strongly criticised by Iranian-Americans for attending a fund-raiser held by members of the AIC and another pro-Tehran lobbying group in California last month, according to well informed sources.

Also addressing the group was Senator Robert Torricelli (D, NJ), who until recently has been an outspoken supporter of the outlawed Iranian Mojaheedin Khalq Organisation, an Islamic Marxist group that is based in Baghdad and supported by Saddam Hussein.

Senator Chuck Hagel (R, NE) gave a rambling keynote speech emphasizing the need for opening trade with Iran. When asked by Insight if he realised that the AIC was a pro-Tehran lobbying group, Hagel said "Hmpf" and walked off without further comment. ENDS KHALILZAD ON IRAN 17302

* Kenneth R. Timmerman is a senior writer at Insight and other leading American publications, specialising in the Middle East and Iranian affairs.