Time for US and Iran to reset relations

"Such very fine brains" filled with "such bad ideas". That was how the late Daniel Patrick Moynihan, a former United States senator and perhaps the keenest mind to enter US politics since the second world war, once described India, where he was US ambassador in the 1970s. That snappy description of my country is also a very good way to describe the current – and seemingly unending – contretemps between the leaders of Iran and the US.

As a new round of negotiations with Iran begins – with European Union high representative Catherine Ashton the first into the breach – finding a way to move Iran-US relations beyond their freighted past is an urgent matter. In both countries, deep and mutually paralysing suspicion has poisoned relations for three decades. Negotiations in such an atmosphere are almost fated to failure.

America's acceptance of Iran's current regime is grudging. Iranian leaders demonise the US as if the millions killed in the 1980s in the Iran-Iraq war (in which the US backed Saddam Hussein's invading army) died only yesterday. So long as these dark shadows are allowed to linger, "resetting" relations between the two countries, in the manner of US-Russia relations, will be impossible.

The list of disputes between the two countries is almost endless, but Iran's plan to enrich uranium now stands above everything else. The Iranians insist that they need nuclear power to generate electricity. Their secretiveness, maintains the US, betrays the regime's drive to develop nuclear weapons.

Not surprisingly, given the Americans' deeply ingrained suspicion, the agreement reached earlier this year between Iran and Turkey and Brazil to allow for the export of low-enriched uranium from Iran in return for fuel rods was "not acceptable" to the US. Indeed, after years of sanctions, threats, negotiations, and then more sanctions and threats, the US remains unclear about what specific nuclear programme it might accept.

So what does the US want? "Crippling sanctions", Secretary of State Hillary Clinton once said, though she quickly retracted that impromptu remark. But no such caution restrains US senators like South Carolina's Lindsey Graham, who says that the "evil (of) a nuclear… Iran" will affect the US "far more than (any) conflict". Following the hopeful early months of the Obama administration, this "stop Iran" policy has become America's focus.

Iran, of course, repeatedly asserts its commitment to the Nuclear Non-Proliferation Treaty (NPT), but its past relations with AQ Khan – the self-proclaimed "godfather" of Pakistan's nuclear-weapons programme, and the world's most notorious nuclear proliferator – invites scepticism. Indeed, the US holds the "Khan network" responsible for helping Iran start its own nuclear programme.

Mistrust is compounded by Iranian President Mahmoud Ahmadinejad's incendiary pronouncements, particularly about Israel. Although the origins of Iran's nuclear programme are to be found in the "enlightened" presidency of Mohammad Khatami (1997-2005) – it was just before Ahmadinejad's inauguration that Iran ended its self-imposed moratorium on uranium enrichment – Ahmadinejad's bombast has made matters worse. And not just with the US. In September 2005, the International Atomic Energy Agency deemed Iran "non-compliant" with the NPT. Between 2006 and 2008, Iran was subjected to three United Nations security council resolutions, each imposing yet more sanctions. Yet, despite increasing economic costs, Iran's response only hardened.

Iran's insecurity goes back at least to 1953, when US and British officials plotted the military coup that removed from office Mohammed Mossadegh, Iran's first elected prime minister and an ardent nationalist, and installed General Fazlollah Zahedi. Mossadegh's sin was his plan to nationalise Iran's oil industry. But, in the process of laying claim to Iran's oil, subverting its democracy, and jeopardizing its national security, the US and Britain committed a much graver sin: the wounding of Iranians' national pride.

Then, there is the Shah's ouster, Ayatollah Ruhollah Khomeini's Islamic Revolution, the absurd abduction of US diplomats, President Jimmy Carter's disastrous attempt to free them militarily, and the "Iran-Contra" scandal, when Reagan administration officials sought to sell weapons to Iran through third parties and channel the proceeds to anti-Sandinista guerrillas in Nicaragua.

Iran sits at the heart of an extremely volatile region. The country's Shia footprint stretches from the Mediterranean to the Hindu Kush. It has a vital role in Afghanistan; indeed, it was passively supportive of the removal of the Taliban from power in 2001. With such a country, "non-engagement" means having no policy at all. America's failure to talk to Iran is as foolhardy as its decades-long failure to talk with Mao's China. And the ongoing failure to talk to North Korea does not appear to be working either, as the recent shelling of South Korea demonstrates. Even if Iranian nuclear weapons are not acceptable to the US, President Barack Obama needs to start talking more openly about what is. His Nobel peace prize demands it.

And talking should not be impossible. As India's foreign minister, I engaged in successful talks with Iran frequently. Iran may be a self-proclaimed theocracy, but it has conducted foreign relations since the 1979 revolution in a rational, if not always emollient, way. Ahmadinejad may bluster, but there is usually considerable ambiguity and calculation behind his outbursts. Iran is obstinate, prideful, ambitious and, yes, sometimes paranoid. But it also sees itself as vulnerable. A young population with no memory of the Islamic revolution is desperate for the jobs that its leaders have failed to provide.

In these circumstances, if Iran is offered a diplomatic ladder that it can climb down with its dignity intact – above all, a credible promise of an historic reconciliation with the US that includes specific economic benefits, not Obama's current vague offers – a tired revolution's troubled leadership might take it. That, not western bluster and sanctions, is the way ahead.

Jaswant Singh, India's former foreign, defence, and finance minister.