Iranian President Mahmoud Ahmadinejad said Friday a U.S.-endorsed incentive package was a positive step toward resolving the standoff over Tehran's nuclear program.

Ahmadinejad's remarks were the highest-level sign that Iran was preparing to negotiate over the package, which calls for talks with the U.S. and other incentives if Iran freezes its uranium enrichment program.

"Generally speaking, we're regarding this offer as a step forward and I have instructed my colleagues to carefully consider it," Ahmadinejad told reporters after meeting with Chinese President Hu Jintao in Shanghai.

In Washington, Secretary of State Condoleezza Rice called the signals from Iran encouraging.

"Certainly we have heard some positive statements from the Iranians," Rice said following a meeting with her Italian counterpart, Foreign Minister Massimo D'Alema.

Ahmadinejad also said Iran was not afraid of an Israeli attack to stop its nuclear program. He also repeated assertions that the Nazi Holocaust was unproven, saying it should be independently investigated.

"An event that has influenced so many diplomatic and political equations of the world needs to be investigated and researched by impartial and independent groups," Ahmadinejad said.

The hard-line president has previously dismissed the Holocaust as a "myth" and said Israel should be "wiped off the map." His questioning of the World War II slaughter of 6 million Jews in the past has drawn scorn and condemnation from the West and Israel.

Iran has sent mixed signals about the incentive package- also backed by three European countries, Russia and China-ever since it was offered last month. On Thursday, Iran's supreme leader, Ayatollah Ali Khamenei, was quoted on state television as saying: "The Islamic Republic of Iran will not succumb to these pressures."

Also Friday, Israeli Vice Premier Shimon Peres said Iran will suffer deepening poverty and isolation if it spurns international appeals to halt its nuclear activity.

"Their choice is to keep the country poor and their arsenal rich. It cannot go on forever," Peres told reporters on the fringes of a conference in the Central Asian nation of Kazakhstan.

Attending the same meetings, Iran's deputy foreign minister, Said Abbas Irakchi, told reporters that Tehran had some concerns about the proposal.

"We see a lot of positive things there, but there are some things that we don't understand and that raise questions," he said.

Irakchi did not say what problems Iran saw with the incentives.

Iran denies accusations by the U.S. and others that it is seeking to develop nuclear weapons, saying its program would only generate energy.

Also Friday, EU leaders at a summit urged Iran to give an early positive response to the package of incentives and penalties. They did not specify a deadline for Tehran's response.

British officials said that although Tehran needs adequate time to consider the offer, the position may harden if Iran does not offer a formal response by the G8 foreign ministers' meeting in Moscow on June 29.

In Shanghai, Ahmadinejad said a response to the package will come "in due time in line with the international interests of the Islamic Republic of Iran."

The United States has said it will wait for a formal response from Tehran to the E.U. foreign policy chief, Javier Solana, who delivered the proposal earlier this month.

"We need an answer, the international community needs an answer, so that we know if in fact the negotiating track is indeed one that is going to bear fruit," Rice said.

"There is a very positive proposal on the table for Iran, and I certainly hope that Iran is going to choose the path of cooperation."