China has stayed away from the Iranian dispute in the past to avoid falling out with a key oil supplier, but at the same time harbours fears of a nuclear arms race if Iran gains the ability to make nuclear weapons.
Analysts say that China‘s reliance on Iranian oil exports to feed its increasing energy needs, however, puts Beijing in a difficult position in taking on a bigger role in the negotiations.
“With this balance of interests, it’s difficult to imagine China being a place for breakthroughs,” Shen Dingli, an expert on nuclear politics at Fudan University in Shanghai, told Reuters.
“The equation of interests won’t change and China isn’t some magical place to solve problems. But it’s important to show that China is part of the international mainstream on these issues.”
The Shanghai meeting is expected to discuss whether to sweeten a 2006 offer of incentives to persuade Iran to curb its nuclear programme, a Western diplomat told Reuters.
China, the US, France, Russia, Britain and Germany had offered civilian nuclear co-operation as well as civilian aircraft, energy, technology and farming incentives if Iran agreed to suspend uranium enrichment and start negotiations.
But Iran has ruled out halting or limiting its nuclear work in exchange for such incentives, saying it will only negotiate with the International Atomic Energy Agency, the UN nuclear watchdog.
The Shanghai talks also come as the top general in the US military said Iran was likely to be the biggest challenge for Washington over the next five years.
Admiral Michael Mullen, chairman of the Joint Chiefs of Staff, said Iran “is at the heart of a great deal of discontent and disruption and instability in that part of the world”.
“So I have expectations that Iran will remain front and centre, certainly for at least the next three to five years,” he said.
He said all options must be kept on the table but “I am not arguing that that is where the next conflict occurs”.
“And I would hope that in the future we could figure out a way to dialogue with them to figure out a way ahead,” Mullen said.
The talks are also occurring amid an intensifying war of words between Iran and Israel.
On Tuesday, Iran‘s deputy army chief, General Mohammad Reza Ashtiani, said Iran will “eliminate” the Jewish state if it is attacked, after Israel‘s army conducted a major exercise last week involving simulated nuclear weapons.
Ehud Barak, Israel‘s defence minister, says his country will continue making efforts to counter any attempts by Iran to obtain nuclear arms.