The International Atomic Energy Agency on Friday said questions remained about Tehran's atomic activities and confirmed Iran had resumed its nuclear fuel work, setting the scene for a possible referral to the UN Security Council.

When asked what effect such political pressures could have on the pipeline project, Indian Foreign Ministry spokesman Navtej Sarna told reporters: "We have an interest in taking it forward, India needs gas."

Sarna was speaking during a visit by Indian Foreign Minister Natwar Singh to Tehran.

India has to tread a tightrope in pipeline talks, trying to satisfy it ravenous appetite for hydrocarbons while not upsetting Iran's arch-foe Washington.

The United States accuses Iran, the world's second-biggest holder of natural gas, of seeking nuclear arms, funding anti-Israeli militia and stirring militant attacks against US forces in Iraq. India faces a natural gas deficit of 200 million cubic metres a day in 20 years.