Israel discussing Iran "red line" with U.S. -Netanyahu

* Netanyahu hints military action could be avoided

* Says Iran "might pause" nuclear drive if red line set

By Maayan Lubell

JERUSALEM, Sept 10 (Reuters) - Israel and the United States are in discussion on setting a "red line" for Iran's nuclear programme, Prime Minister Benjamin Netanyahu said.

"We're discussing it right now with the United States," Netanyahu said in an interview with Canada's CBC television aired late on Sunday.

In the interview, two days after Canada suspended diplomatic relations with Tehran over its nuclear project, Netanyahu again signalled that a clear boundary - which he has yet to define publicly - could obviate the need for military action.

Netanyahu's recent calls for world powers to set a "clear red line" that would show they were determined to stop Tehran's nuclear drive has suggested a growing impatience with the United States, Israel's main ally.

Washington, which has resisted the idea of laying down red lines for Iran in the past, has been pressing the Israeli leader to give diplomacy and sanctions imposed on the Islamic Republic more time to work to rein in Iran's nuclear work peacefully.

Recent heightened Israeli rhetoric has stoked speculation that Israel might attack Iran before the U.S. elections in November, believing that President Barack Obama would give it military help and not risk alienating pro-Israeli voters.

DIFFERENCES IN ISRAELI LEADERSHIP

But Netanyahu has faced opposition to any go-it-alone attack from Israeli security chiefs and its popular president, Shimon Peres. Opinion polls show a majority of Israelis do not want their military to strike Iran without U.S. support.

"I don't think that they (Iran) see a clear red line, and I think the sooner we establish one, the greater the chances that there won't be a need for other types of action," Netanyahu said, appearing to refer to military steps.

"If Iran saw that, there's a chance, I won't say it's guaranteed, but there's a chance they might pause before they cross that line."

Israel and the West believe Iran is working toward nuclear weapon development capability. Israel, widely thought to be the Middle East's only atomic power, says a nuclear-armed Iran would be a threat to its existence. The Islamic Republic says its nuclear work is for peaceful energy purposes only.

A senior Israeli government official, who spoke on condition of anonymity, said talks were being held with "the American administration," as to the red lines. He declined to elaborate.

Israeli newspaper Haaretz said on Monday Netanyahu had told German Foreign Minister Guido Westerwelle that if Iran enriched uranium above 20 percent, that would provide a red line as it would prove Tehran had chosen to exceed the level of refinement suitable for civilian energy and "break out" with an atom bomb.

Enrichment to 90 percent fissile purity is the typical threshold for weapons-grade nuclear fuel. Haaretz said Netanyahu stressed that from the moment Iran decided to make a nuclear bomb, it would need only six weeks to enrich to 90 percent.

Many independent analysts say, however, that Iran would need additional time - from several months to a year or more - to fashion weapons-grade material into a nuclear warhead and fit onto a missile capable of delivering the payload.

Netanyahu, who met Westerwelle on Sunday in Jerusalem, is scheduled to travel to the New York and address the U.N. General assembly about Iran later this month.

A meeting with Obama, who is deep in his re-election campaign and due to speak to the forum two days before Netanyahu arrives, has not been finalised, the Israeli official said.