TEHRAN'S Grand Bazaar is a wonderful place.

Some years ago while transiting the Iranian capital en-route for the border with Iraq on the eve of the war there, I spent a few days exploring the miles of trading corridors that line this marketplace.

Here, the ancient sits cheek-by-jowl alongside the modern in a place you can buy everything from exotic spices to digital wrist watches. The one thing no-one will be buying there soon, however, is the newly released video game entitled Battlefield 3, reportedly banned by the Iranian authorities.

Tehran's concern over the game, not legally available in the country, has nothing to do with video piracy, but because it includes a fictional military assault and urban warfare by US Marines on parts of the Iranian capital including the Grand Bazaar.

In itself the controversy surrounding the game might seem a petty issue. But its release when tension is running extremely high between Iran and the West, only adds to the prevailing feeling of paranoia in Tehran.

In its own tiny way, too, it also rachets up the bitterness behind the diplomatic campaign currently aimed at isolating the Tehran regime. A strategy which should it fail to bring President Mahmoud Ahmadinejad's regime to heel, may yet lead to direct Israeli and Western military action in an effort to curtail Iran's procurement of a nuclear arsenal.

Enormous political pressure is being piled on Tehran. And all this is running in tandem with an escalation of covert intelligence, sabotage and assassination operations inside the country against military targets, nuclear scientists and missile specialists that doubtless make the scenes depicted in Battlefield 3 eerily prescient for many ordinary Iranians.

Yesterday, Foreign Secretary William Hague was leading the latest charge against Iran's nuclear ambitions, calling for an "intensification of sanctions", the response to which by his EU counterparts was to impose fresh restrictions that would target 180 Iranian officials and firms connected with the programme.

Add to this the expulsion of Iranian diplomats from Britain and elsewhere in Europe, talk of an oil embargo and the freezing of financial assets and there is no doubt efforts to isolate President Ahmadinejad's regime have now taken on a real sense of urgency.

What's more, you only have to scour online Middle East news websites to come across endless stories warning of Iran's efforts to build and acquire weapons of mass destruction.

On Wednesday, it was the turn of the Jerusalem Post, quoting Arieh Herzog, director of Israel's Homa Missile Defence Agency, as saying Iran was developing an advanced low-flying cruise missile that could potentially carry a non-conventional warhead.

While recent UN reports bear out Israel's concerns that Iran is working to acquire WMD, in certain Western and Israeli quarters there are those who never miss an opportunity to ram home that message time and again, loud and clear at the expense of trying to reopen dialogue.

The demonisation of Iran is, of course, nothing new, the country having long been perceived by many in the West as the source of much evil in the Middle East. What's worrying though is the extent to which this Tehran-bashing process is taking on a marked similarity to that directed against Saddam Hussein's Iraq in 2002.

As the veteran Middle East watcher and journalist Patrick Cockburn pointed out recently: "In both cases, an isolated state with limited resources is presented as a real danger to the region and the world. Iran's nuclear programme is identified as a threat in much the same way as Saddam Hussein's non-existent WMD."

Whether one agrees with Mr Cockburn's take, there's no denying some rather intriguing events have taken place recently that have gone some considerable way to help further demonise Iran while at the same time presenting those opposed to the Tehran regime in a favourable light.

Take, for example, the extraordinary lobbying efforts lately in the United States to reverse the blacklisting of the fringe Iranian opposition group the Mujahideen Khalq (MEK) as a terrorist organisation. Once a close ally of Saddam Hussein and unequivocally designated a terrorist group by the State Department, the MEK in the 1970s was responsible for killing Americans.

Now, however, given its anti-Ahmadinejad credentials, a veritable array of senior US politicians and security officials have rallied to declare the MEK's terrorist label "outdated and unjustified".

Interesting, is it not, they should choose this particular moment to do so? Interesting, too, that many Middle East analysts have consistently pointed out the CIA, Israel's Mossad intelligence service and Britain's MI6 may at this moment be using the Mujahideen Khalq as proxies to help them carry out covert activity inside Iran against its nuclear weapons programme, activities many suspect may have included the assassination of Iranian officials.

According to a recent New York Times article, among those high-powered US lobbyists working hard to present the MEK as an acceptable face of Iranian opposition are two former CIA directors, R James Woolsey and Porter J Goss; a former FBI director, Louis J Freeh; a former attorney general, Michael B Mukasey; President George W Bush's first homeland security chief, Tom Ridge and President Barack Obama's first national security adviser, General James L Jones.

These "advocates", says the New York Times, have been flown to European cities including Paris, Berlin and Brussels for appearances where they made speeches on behalf of the MEK.

"In my view, if you're a threat to Mahmoud Ahmadinejad well, the enemy of my enemy is my friend," was how one of these US lobbyists recently explained away his support for the MEK.

Watching the political and military pressure build on Iran, the sanctions, disinformation, propaganda and coming together of former foes in the shape of new unholy but convenient alliances, I can't help being reminded of the months before the start of the 2003 war in Iraq.

In breaking off diplomatic relations and effectively isolating and demonising Iran, the West is taking a dangerous step into the unknown. One can only hope it is not a step backwards that could see us revisit the likes of those dark days in 2003.

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