Appearing on a U.S. television program, Zavad Zarif, Iranian deputy foreign minister of international affairs, said the United States had offered no persuasive proof of his country's involvement in the alleged arms deal.
"We have asked the United States to provide any information that it has in order for us to investigate. We have done our own investigation ... but the U.S. simply says that it has evidence," Zarif said. "I don't think you (the U.S. government) have sent any convincing evidence to anybody."
Israel seized a ship on Jan. 3 in the Red Sea that it said was laden with 50 tons of Iranian weapons destined for the Palestinian areas in violation of interim peace deals. Palestinian leader Yasser Arafat has come under intense Israeli and U.S. pressure over the incident.
Zarif told the "Fox News Sunday" program the charges were "totally fabricated" and based on politically inspired intelligence.
"I can tell you categorically that all segments of the Iranian government and I mean total government, not simply President (Mohammad) Khatami's administration, have had nothing to do with the sending of arms to Mr. Yasser Arafat or to the Palestinians," he said.
Iran, a chief patron of the Hizbollah organization accused in many attacks against Israel in the latest uprising, is on the U.S. State Department's list of states sponsoring terrorism.
Zarif also denied Iran was sending forces to Afghanistan or sheltering any top al Qaeda or Taliban members in his country, despite information provided by the United States on their whereabouts.
"We have not found anybody on those lists in Iran," he said. "We have found traces and we will look into those traces but if there are any people who are in Iran, either al Qaeda or Taliban ... we will return them to their own countries or to the government of Afghanistan."
He said he had no information on the whereabouts of Saudi exile Osama bin Laden or "any members of al Qaeda or any senior officials of the Taliban are in Iran."
Washington says many al Qaeda militants slipped into Iran from neighboring Afghanistan following the defeat of the ruling Taliban, which sheltered bin Laden, who is accused of masterminding the Sept. 11 attacks on America.
The United States also says Tehran plotted to destabilize the new government of Afghanistan. Iran has insisted that it supports the interim government of Hamid Karzai, which is to run the country until June.
Iran is believed to be concerned by Washington's growing influence in Afghanistan, where a U.S. bombing campaign last year helped bring Karzai to power.
Iran has also become concerned that it may be a new target in the U.S. war agains terror after U.S. President George W. Bush accused it of belonging to an "axis of evil" that supports terrorism.
President Mohammad Khatami met Wednesday with foreign ambassadors in Iran. He was quoted by Iranian radio as saying that the U.S. military budget is a reason for concern.
"We all should be worried that the president of the United States has put forward the highest budget for war," Khatami said late Sunday. "We should think about a coalition for peace not for war."
Khatami also criticized American support for Israeli Prime Minister Ariel Sharon, saying "America, by supporting Sharon, whom even most Westerners acknowledge is a war criminal, is putting the region in crisis."
Early in the U.S. war on terrorism, American officials spoke of better cooperation with Iran. But in the past month, anti-Iranian rhetoric has grown strong from Washington.
Iranian newspapers and state-run radio and television have responded, calling for a nationwide anti-American rally Monday to mark the 23rd anniversary of the Islamic revolution, which swept U.S.-backed Shah Mohammed Reza Pahlavi from power.
"One of the goals of recent American threats is to frighten the Iranian nation and authorities, so tomorrow's rally is extremely important and decisive, and I have no doubt that the people will give a strong response to the enemy by attending the rally," Supreme Leader Ayatollah Ali Khamenei said, according to state-run Tehran radio.
Even reformist Khatami, who has in the past called for unofficial dialogue with the Americans, said the rally was a sign of Iran's resolve.
"Considering the baseless, incorrect and insulting statements against the Iranian nation and revolution this year, I'm sure the people tomorrow will show their loyalty to the revolution," Khatami told Iranian television Sunday.
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