Iran is believed to be further increasing its uranium enrichment capacity at its Fordow plant buried deep underground, Western diplomats say, in another sign of Tehran defying international demands to curb its disputed nuclear programme.

But they said the Islamic Republic did not yet appear to have started up the newly-installed centrifuges to boost production of material which Iran says is for reactor fuel but which can also have military uses if processed more.

“Iran continues to build up enrichment capacity,” one Western official said.

A diplomat accredited to the U.N. International Atomic Energy Agency (IAEA) said: “We think that they have continued installing centrifuges at Fordow. We think that their pace has continued the same as it was, which was pretty rapid.”

If confirmed in the next IAEA report on Iran’s atomic activities, expected in mid-November, it would suggest Iran is steadily moving towards completing instalment of centrifuges at the Fordow subterranean centrifuge site.

The work may be “near complete,” the Vienna-based diplomat said, in remarks echoed by another envoy.

There was no immediate comment from Iran or the IAEA, the U.N. nuclear agency based in the Austrian capital.

Fordow -- which Tehran only disclosed the existence of in 2009 after learning that Western spy services had detected it -- is of particular concern for the United States and its allies as Iran uses it for its higher-grade enrichment.

Iran says it needs uranium refined to a fissile concentration of 20 percent, compared with the level of up to 5 percent it produces at its main enrichment facility at Natanz, to make fuel for a medical research reactor in Tehran.