'Hard-headed' Brown gets tough with Tehran over its nuclear programme

Gordon Brown threatened Iran with an international ban on oil and gas investment last night as he mapped out the "hard-headed internationalism" that will guide his foreign policy.

Downing Street made clear military action remained an option for dealing with the Islamic state if it presses ahead with its efforts to acquire nuclear weapons.

The Prime Minister's first major statement on international affairs was designed to counter claims that he is less interested in the intricacies of diplomatic relationships than Tony Blair.

He used the annual Mansion House address to defend himself against charges that he has deliberately cooled relations with the United States, insisting it remains Britain's single most important bilateral relationship.

The Prime Minister warned Iran that it "should be in no doubt about our seriousness of purpose".

With the country's president Mahmood Ahmedinejad intent on defying international calls to respect nuclear proliferation agreements, Mr Brown raised the prospect of tougher sanctions against the regime.

But it was his robust language that struck a chord, during an appearance that saw him bow to the dress code of his City hosts and wear white tie and tails after a decade of appearing in a lounge suit when he was Chancellor.

Mr Brown said he would urge both the European Union and the United Nations to impose tougher sanctions on financial sector dealings with Iran.

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He told the Lord Mayor's banquet in the City of London that the measures would be needed unless there were "positive outcomes" from both an EU and an International Atomic Energy Authority report into Iran's nuclear programme, due to be published shortly.

"We will lead in seeking tougher sanctions both at the UN and in the European Union, including on oil and gas investment and the financial sector," he said.

Mr Brown also called on President Pervez Musharraf of Pakistan to step down as head of the army, restore the constitution, free political prisoners and hold "free and fair elections".

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He called for far-reaching reforms of international institutions, including expanding the UN Security Council to include African countries and major economies such as Japan and Germany.

The Prime Minister said: "My approach is hard-headed internationalism - internationalist-because global challenges need global solutions and nations must co-operate across borders, often with hard-headed intervention, to give expression to our shared interests and shared values."

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Stressing the importance of the UK's relationship with the United States, Mr Brown made clear: "It is no secret that I am a lifelong admirer of America.

"I have no truck with anti-Americanism in Britain or elsewhere in Europe and I believe that our ties with America - founded on values we share - constitute our most important bilateral relationship."

He admitted: "There is still a gaping hole in our ability to address the illegitimate threats and use of force against innocent peoples.

"We now rightly recognise our responsibility to protect behind borders where there are crimes against humanity. But if we are to honour that responsibility we urgently need a new framework to assist reconstruction."

But he insisted: "The greatest immediate challenge to non-proliferation is Iran's nuclear ambitions, hidden from the world for many years in breach of the Non-Proliferation Treaty.

"Iran has a choice - confrontation with the international community leading to a tightening of sanctions or, if it changes its approach and ends support for terrorism, a transformed relationship with the world."