The Israeli Prime Minister has begun talks with the US Middle East Envoy

Israeli PM Benjamin Netanyahu has praised a UN proposal to regulate Iran's uranium enrichment programme.

Speaking before talks with US Middle East envoy George Mitchell, he called it a "positive first step" in stopping Tehran developing a nuclear weapon.

Under the plan, low-enriched fuel would be further processed outside Iran.

On Thursday, the UN's nuclear watchdog confirmed it had received Iran's response to the directive, but its contents have not been released.

Mr Netanyahu said: "I think that the proposal to have Iran withdraw its enriched uranium, or a good portion of it, outside Iran is a positive first step."

He also praised US President Barack Obama's efforts in drawing global attention to the issue of Iran's nuclear programme.

'Old tricks'

But striking a different note in Brussels, European leaders are reported to be preparing a critical draft communique expressing "grave concern" over Iranian nuclear enrichment and its "persistent failure to meet its international obligations".

Swedish Foreign Minister Carl Bildt, whose country holds the rotating presidency of the European Union, told the AP that Iran's approach of "back-and-forth talks" were reminiscent of its "same old tricks."

Tehran insists it is enriching uranium for peaceful purposes, fuel and medical research, but the US and its allies have accused it of seeking nuclear weapons.

The head of the International Atomic Energy Agency, Mohamed ElBaradei said he was hopeful of reaching an agreement with Tehran when he received Iran's response to the UN draft on Thursday.

Iranian President Mahmoud Ahmadinejad had described the IAEA proposal as a move from "confrontation to co-operation" by Western powers, but that Iran would "not retreat even an iota" over its right to develop a civilian nuclear programme.

The plan proposes exporting most of Iran's enriched uranium to Russia and France for conversion into fuel rods before being returned.