TEHRAN - Khatami has tried to smooth over Iran's power struggle as an "illusion" but conservatives are stepping up the attack on his faction two weeks after bloody riots shook the nation.

In a message laden with contradictions, Khatami acknowledged the violence was a "declaration of war" on him while insisting the self-evident battle over his political program was simply a mirage.

"There is no split between the government, the presidency and the supreme leader," Khatami said, referring to Khamenei.

Any appearance of a political schism between factions was, he said, an "illusion."

But the facts belie the rhetoric as Khatami has watched his closest allies jailed and his strongest supporters in the press muzzled by political opponents.

At the same time Khatami has seen his diplomatic stature abroad, enhanced initially by his high-profile overtures to the West, severely weakened by the arrest of 13 Iranian Jews on charges of spying for Israel.

Perhaps most damaging of all were the riots themselves, which two weeks later remain shrouded in mystery, with official accounts wildly different from those in the press.
 
 

Iranian Cleric Alarmed By Youth Role In Unrest, Reuters, July 28

TEHRAN - A senior Iranian cleric said Wednesday that most of those arrested in the recent unrest were less than 20 years old.

"Those arrested are generally under 20 years old. This is alarming," said Mohammad Mohammadi Golpayegani, a top aide to supreme leader Ali Khamenei.

"The first generation (of the 1979 Islamic revolution) has not been able to transfer values to the second generation. This is a threat and we must not let it slip by easily," he told a gathering of officials and clerics, attended by journalists.

Hundreds were arrested in riots in mid-July that followed pro-democracy student unrest.

"It was a big conspiracy. But, thank God, our people thwarted it like they have always done," Golpayegani said. Officials have blamed the unrest on agitators linked to exiled dissidents.
 
 

Iran Seen Shunning U.S. Wheat For Now, Reuters, July 28

PARIS - Factional infighting in Tehran and ongoing hostility toward the United States is likely to keep Iran from buying U.S. wheat for now, European banking sources and grain traders said this week.

They said Iran would continue buying from Europe and Australia for the time being, despite Washington's issuance of rules allowing U.S. firms to resume food and medicine sales to the Middle East state and despite a devastating drought that has nearly doubled Iran's estimated wheat import needs.

"Iran has no vital need to open its market to the United States. There are other sources of supply," an exporter said, noting Iran's recent purchase of 360,000 tonnes of French wheat.
 
 

Agent of Mullahs' Intelligence Ministry Arrested in Germany, Iran Zamin News Agency, July 27

An Intelligence Ministry agent spying for the mullahs' regime has been arrested in Berlin. He was trying to infiltrate the ranks of supporters of the Mojahedin and Iranian Resistance in Germany to obtain information and carry out espionage and acts of terrorism.

A statement by the Committee on Counter-terrorism of the National Council of Resistance of Iran disclosed: "The agent, Hamid Khorsand, has been a resident in Germany since the early 1980s and has had close ties with the convicted terrorist, Kazem Darabi. Kazem Darabi, one of the agents involved in the 1992 murder of Iranian dissidents at Mykonos Restaurant in Berlin, was found guilty by a German Federal Court and is now in prison."
 
 

Mullahs' Devastating Mismanagement of Iran's Forests, Reuters, July 28

TEHRAN - The toll from floods in northern Iran reached 51 dead and missing on Wednesday, as fresh flooding hit the country's northeast, IRNA reported.

A leading environmentalist blamed the flooding on extensive deforestation of land near the rivers and over-grazing.

"We have in reality interfered in this area's ecology...and we will witness similar bitter events in the future," Anoushiravan Najafi told the daily Entekhab.

A relief official in the northern Mazandaran province said 34 people had been killed and 17 were missing but that the toll from the floods could rise after accounting for visiting tourists.

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