Iran’s supreme leader Ayatollah Ali Khamenei told the government on Thursday to adopt an “economy of resistance” to confront crippling sanctions slapped by the West on Tehran over its nuclear drive.

“The arrogant powers are pulling their weight to force Iran to back down (on its stances) and the government should invalidate these illusions by using the nation’s full potentials,” Khamenei said.

He called for an “economy of resistance” to confront a slew of Western oil and financial sanctions, saying this “is the only way to pursue progress in the country.”

“In this kind of economy the nation’s progress is preserved and vulnerability of the economy against the enemies plots is decreased,” Khamenei said during a meeting with cabinet members and President Mahmoud Ahmadinejad.

During his speech Khamenei did not specifically mentioned sanctions nor Iran’s controversial nuclear drive.

But his comments comes as several Iranian officials, who had long minimised the effect on the sanctions, acknowledged in recent weeks that the punitive measures have had a negative impact on the country’s economy.

The UN nuclear watchdog chief played down chances of a breakthrough when talks with Iran resume on Friday but said the agency would pursue access to a military site that diplomats say may have been cleansed of evidence of illicit nuclear activity.

Visiting the Parchin complex has become a priority for the International Atomic Energy Agency (IAEA) as it seeks to end what the West sees as Iranian stonewalling of an IAEA investigation into allegations that Tehran has sought to design a nuclear weapon.

“I cannot be too optimistic. We have been making our best efforts in a constructive spirit to work out an agreement between Iran and IAEA, but so far we have not been successful in reaching agreement,” agency Director General Yukiya Amano told reporters on Wednesday during a visit to Finland. “I have no indication this will change very soon,” he said.

Amano said the IAEA still wanted access, but that apparent efforts to sanitise Parchin could impede the agency’s inquiry.

“Through the satellite imagery we think that Iran is moving soil, demolishing buildings, using water, removing fences, doing landscape activities.”