By Matt Spetalnick and Steve Holland
UNITED NATIONS (Reuters) - President Barack Obama said on Tuesday the United States was ready to engage diplomatically with Iran in what could be a historic opening between the long-time foes but put the onus on the new Iranian president to prove he is serious about pursuing a nuclear deal.
Addressing an annual summit of world leaders at the United Nations, Obama said he wanted to put President Hassan Rouhani's overtures to the test and challenged him to take concrete steps toward resolving Iran's long-running nuclear dispute with the West.
"Conciliatory words will have to be matched by actions that are transparent and verifiable," Obama told the United Nations General Assembly.
Rouhani's recent overtures, including agreement to hold new talks on its nuclear program, have raised international hopes for a thaw in relations between Washington and Tehran after more than three decades of estrangement.
The White House has left open the possibility that Obama and Rouhani could meet - at least for a handshake on the U.N. sidelines - later on Tuesday. Even a fleeting encounter would be symbolically important given that it would be the first face-to-face contact between U.S. and Iranian heads of government since before the 1979 Islamic revolution that ousted the U.S.-backed Shah.
But differences over Iran's nuclear program and skepticism about Rouhani's intentions, especially from U.S. lawmakers and close U.S. ally Israel, have cast doubt on the prospect for any immediate breakthrough between Washington and Tehran.
Seeking to keep expectations under control, Obama said suspicions between the two countries were too great to believe their troubled history can be overcome overnight.
"The roadblocks may prove to be too great but I firmly believe the diplomatic path must be tested," Obama said.
Obama added that in Rouhani's recent statements there should be the basis for an elusive deal to curb Iran's nuclear ambitions, but he reaffirmed his position that Tehran cannot be allowed to develop a nuclear weapon.
Obama cited resolving the Iranian nuclear standoff and reaching an Israeli-Palestinian peace deal as his two main policy priorities in the Middle East, efforts that he said he believes can help bring stability to the volatile region.
He also urged the U.N. Security Council to approve a strong resolution aimed at ensuring Syria keeps its commitments to give up its chemical weapons, and said the United States will provide an additional $340 million (212 million pounds) in humanitarian aid.
Iran is a key ally of Syrian President Bashar al-Assad, a U.S. foe whose country has been torn by civil war since 2011.
Rouhani, a moderate cleric elected in June by Iranian voters desperate for relief from economically crushing international sanctions, will have a chance to respond when he makes his U.N. debut later on Tuesday. He and Obama recently exchanged courteous letters.
Rouhani is expected to keep up his charm offensive in front of the world body, further distancing himself from his hard-line predecessor, Mahmoud Ahmadinejad, who was widely vilified in the West for doubting the Holocaust and questioning Israel's right to exist. But it was unclear whether Rouhani would offer anything specific.
The crux of Iran's long-running dispute with the West is its nuclear drive. The United States and its allies suspect that Iran seeks to develop nuclear weapons, but Tehran insists its nuclear program is for peaceful civilian energy purposes only.
Iran on Monday agreed to new talks on its nuclear program with top diplomats from six world powers, including U.S. Secretary of State John Kerry.
Israel voiced concern on Tuesday over the potential meeting of the U.S. and Iranian presidents, saying Tehran's conciliatory overtures to world powers masked an acceleration of its nuclear program.
Asked if there would be an Obama-Rouhani handshake, Yuval Steinitz, the cabinet minister now representing Israel at the U.N. forum in New York, said: "I hope not. I don't know."
(Editing by Will Dunham)