China, the European Union, Japan, South Korea and the United States already have observer status with the eight-nation South Asian Association for Regional Cooperation (SAARC) and will send representatives for the first time this year.
Foreign secretaries meeting ahead of the regional forum, which gets underway here Tuesday, unanimously recommended that Iran's request for such status be accepted, the Press Trust of India said.
The request will now be considered on Monday by South Asian foreign ministers, Indian Foreign Secretary Shivshankar Menon said.
Tensions between Tehran and the West are running high over its capture of 15 British naval personnel in the Gulf last week, with relations already strained over Iran's refusal to halt nuclear enrichment.
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The meeting of foreign secretaries also reviewed the progress of panels formed under the grouping.
New Delhi has repeatedly called for improvements in trade, travel and telecommunications links among members of SAARC, long hel