A majority of European and US policy-makers would prefer a nuclear-armed Iran over taking military action if diplomatic efforts failed, a survey showed Tuesday.

The survey of public officials from both sides of the Atlantic found that opinions diverged between decision-makers and the public on dealing with Iran if non-military options do not work.

Around half of US and European Union policy-makers would accept a nuclear Iran, while 42 percent in Washington's corridors of power and 32 percent in Brussels would favour military action, according to a report by the German Marshall Fund of the United States and Italy's Compagnia di San Paolo foundation.

The public was more hawkish, with 62 percent of Americans and 46 percent of Europeans backing military action.

While 48 percent of EU public officials favour economic incentives to convince Iran to halt its nuclear activities, 33 percent of their US counterparts prefer economic sanctions.

The UN Security Council has imposed sanctions against Iran over its refusal to halt its uranium enrichment programme, and talks between world powers and the Islamic republic have so far failed to resolve the row.

The West suspects Iran wants to develop nuclear weapons but Tehran insists its programme is solely aimed at producing civilian energy for its population.

The "Transtlantic Trends: Leaders" survey was based on interviews with 286 US administration officials, US Congressional staff, analysts and business leaders, and 233 EU officials, members of the European Parliament and other opinion leaders between June and October 2010.