As Hassan Rouhani prepares for his inauguration as Iran's new president on Sunday, the country's state TV claims he was misquoted when he was said to have described Israel as a 'wound' in the Muslim world.

At the annual Al Quds march in support of Palestine in Tehran on Friday, Rouhani was interviewed by journalists when he reportedly made the remarks.

"The Zionist regime is a wound that has sat on the body of the Muslim world for years and needs to be removed," student news agency ISNA reported him as saying.

But later state broadcaster Press TV retracted the claims, and said that Rouhani was misquoted, and in fact said: "After all, in our region there's been a wound for years on the body of the Muslim world under the shadow of the occupation of the holy land of Palestine and the beloved al-Qods (Jerusalem)."

Press TV said that news agencies, "including ISNA, had presented Mr Rouhani as saying the Zionist regime is a wound on the body of the Muslim world that needs to be removed, and this was corrected".

Before the retraction, Israel's Prime Minister Benjamin Netanyahu claimed the comments showed the true face of Rouhani, who was elected as a moderate reformer.

"Even if they hurry to deny his words this is what the man thinks and is the Iranian regime's plan of action," he said in a statement.

Tension between the West and Iran concerns its nuclear programme, which the country's leaders claim is for peaceful purposes, but which Israel claims is being used to develop a nuclear weapon.

Many hope that the election of pragmatic Rouhani increases the possibility of a diplomatic route out of the crisis.

But Netanyahu claimed Rouhani's words "must awaken the world from the illusion in which part of it is placed since the Iranian elections", saying Iran still aimed "to acquire nuclear weapons in order to threaten Israel, the Middle East and world peace".

In a speech yesterday, outgoing Iranian president Mahmoud Ahmidinejad, whom many Iranians blame for the country's growing isolation and economic decline, attacked Israel: "You planted wind in our region and you will reap the storm. I swear to God that a ferocious storm is coming and it will uproot the Zionist entity," Iran's state news agency IRNA quoted him as saying.

Since the 1979 revolution, Iran has denied Israel's right to exist.

64-year-old Rouhani, a former nuclear negotiator and Islamic activist before the revolution, will be endorsed by Iran's Supreme Leader Ayatollah Ali Khamenei tomorrow.