West threatens Iran with sanctions

The United States and European Union have accused Iran of breaking nuclear guidelines by escalating uranium enrichment without IAEA surveillance.

They made the comment at a meeting of governors of the UN's nuclear watchdog. Both sides said Iranian's "provocative" behavior could lead to tougher sanctions.

Iran dismissed the threats as counter-productive, warning they could prompt Tehran to remove its current proposal for nuclear fuel exchange on its territory.

An IAEA report last month said that Iran may be trying to design a nuclear-armed missile.

U.S. Ambassador to the International Atomic Energy Agency, IAEA, Glyn Davies talks to journalists during the IAEA's board of governors meeting at the International Center, in Vienna, on Wednesday, March 3, 2010. (AP Photo/Alexander Mueller)