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“This accusation is within the Zionist regime’s psychological war against Iran,” the official IRNA news agency quoted Foreign Ministry spokesman Ramin Mehmanparast as saying.

Hezbollah and Iran have deep grievances against Israel.

Hezbollah battled Israel in a monthlong war in 2006. On Sunday, the Lebanese guerrilla group marked the anniversary of the 2008 assassination of one of its commanders, Imad Mughniyeh, in a bombing widely believed to have been carried out by Israel. Iran has been widely suspected of looking for payback for the covert plots against its nuclear program it has blamed on Israel’s spy agency Mossad and Western allies.

The violence added further tension to one of the globe’s most contentious standoffs. Iran has been accused of developing a nuclear weapons program that Israel says threatens the existence of the Jewish state. Tehran says its nuclear program is for peaceful purposes only.

Recent comments by Israeli officials have raised fears Israel might be preparing to strike Iran’s nuclear facilities. While Israel says it hopes that international sanctions can curb Iran’s nuclear program, leaders pointedly note that “all options are on the table” and have warned that as Iran moves closer to weapons capability, time is running out for action.

Fearing an Israeli attack could set off a conflict across the region and send oil prices skyrocketing, the U.S. and other Western countries have been pressing Israel to give sanctions more time.

Israeli military analyst Reuven Pedatzur said Monday’s action was unlikely to have any bearing on whether Israel attacks Iran, calling it an “isolated incident” with rather low impact.

Were Iran found to be behind the New Delhi attack, it would be a stunning action against one of its more reliable allies.

Indian Prime Minister Manmohan Singh has resisted U.S. and European Union pressure to curtail trade with Iran over the nuclear issue. Energy-starved India relies heavily on Iranian oil imports, and the two countries are working to find creative ways for India to circumvent banking restrictions to pay for the oil by using rupees and investing in Iranian infrastructure projects.

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Associated Press writer Ashok Sharma contributed to this report.