Vahidi also said that the shell was an "intelligent" munition with the capability to identify its own targets.

State television showed images of artillery being fired, saying it showed the precision-guided ammunition in action. No details were given on the technology purported to be used.

“Iran is now one of just five countries in the world able to manufacture these sorts of weapons through domestic technology,” Vahidi said.

The Islamic republic is subject to a UN embargo on foreign arms imports because of suspicions over its nuclear program. It frequently announces domestically produced, hi-tech breakthroughs in the military sector, though gives few details.

Early this month, it test-fired short-range missiles during navy war games. And Vahidi last week said new air and sea defense systems, and electronic warfare technology, would be presented next month, when Iran commemorates the anniversary of its 1979 revolution.

Meanwhile, an IAEA delegation visiting Iran can choose to extend its stay beyond the three days originally planned if it wishes, Iranian Foreign Minister Ali Akbar Salehi said on Monday, according to the official IRNA news agency.

“We are very optimistic on the results of the IAEA trip. They are here for a three-day trip, and if they want, it (the mission) could be extended,” Salehi was quoted by IRNA as telling Turkish broadcaster TRT in an interview in Addis Ababa, where he was attending an African Union summit.

Salehi also urged the European Union and the United States to “replace their policy of sanctions with interaction” with the country.

A six-person team of senior inspectors and officials from the International Atomic Energy Agency, the UN nuclear watchdog, began their visit to Iran on Sunday amid high international tensions over Tehran's nuclear activities.

The visit, led by IAEA chief inspector Herman Nackaerts and including the agency's deputy director general, was due to wrap up Tuesday.

It was not known which Iranian officials the IAEA team was speaking with, nor was it confirmed whether it was carrying out inspections of suspect sites.  The visit is seen as an opportunity to defuse tensions between Iran and the West that have soared since a November IAEA report that strongly suggested Tehran was researching nuclear weapons. Iran has dismissed the report as biased.

Iran's government has repeatedly denied that its nuclear activities are other than peaceful, and it has asserted its rights to uranium enrichment and atomic energy as a signatory of the Nuclear non-Proliferation Treaty (NPT) that the IAEA oversees.