Iran Joins Arab World Leaders at Conference : Middle East: Egypt’s president calls Islamic unity a necessity, not a luxury. Iran’s attendance is considered a major step toward harmony.

Islamic world leaders, joined by Iran for the first time in several years, convened Tuesday and called for Muslim unity against economic threats from Europe, the immigration of Soviet Jews into the Middle East and the specter of new political turmoil dividing the Arab world.

“Islamic solidarity must be the cornerstone of all our actions,” Egyptian President Hosni Mubarak told delegates from more than 30 Islamic nations, gathered for the first time in Cairo since Egypt’s unpopular 1979 peace treaty with Israel. “Islamic solidarity at this time is no longer a luxury but an indispensable necessity.”

Non-Arab Iran’s decision to send an envoy marked an important break in nearly a decade of hostile relations with most of the Arab world, worsened by Iran’s eight-year-long war with Iraq, during which wealthy Persian Gulf leaders poured billions of dollars into the Iraqi war chest.

Ravaged by the war, more than four years of shrunken oil prices and long years of international isolation, Iran in recent months has made a series of small overtures to the Arab world that diplomats say could bring the radical nation back into the heart of the Islamic fold.

In early July, the Iraqi and Iranian foreign ministers sat down for their first direct talks since the Persian Gulf War cease-fire, marking what U.N. Secretary General Javier Perez de Cuellar called a “psychological breakthrough” that could lead to a permanent peace pact.

Later, Iranian Foreign Minister Ali Akbar Velayati flew to Kuwait for talks with the Kuwaiti emir, his first such visit since the 1979 Iranian revolution and a prelude to what Iranian officials said are likely to be closer ties to the Arab gulf nation.

In addition, the Egyptian press has reported that Iran has broached the subject of restoring official ties with Cairo, a proposal Egypt apparently has greeted with caution. Iran severed ties with Egypt, along with most of the Arab world, after the signing of the Israeli-Egyptian peace treaty.

Iran’s acceptance of the invitation to this week’s meeting of the Organization of the Islamic Conference was regarded as a significant step toward increased harmony with the Arab world. This is so despite the fact that Tehran’s long and bitter dispute with Saudi Arabia over the annual pilgrimage to the Islamic holy city of Mecca is likely to come up as a point of acrimonious discussion.

Iran’s decision to send an envoy “is an attempt to get back into the world,” one Western diplomat said. “They’ve got a whole lot of rebuilding to do, and they don’t need enemies.”

“The Iranian hierarchy has, from the day of the revolution, demonstrated tremendous acumen and, where necessary, pragmatism,” another analyst said. “The war is over. They’re arguing about the terms of the settlement. Here (at the conference), they’re going to get away with making their pitch to the Arab world.”

To sweeten the atmosphere, Iran announced Tuesday that it will free all remaining Egyptian prisoners of war--perhaps as many as 1,000--taken captive when they fought on behalf of Iraq during the gulf war.

The conference is not expected to lead to any important new accords, but delegates will be discussing how the Islamic world can respond to the continuing Palestinian conflict; the worsening situation in Kashmir and the immigration of Soviet Jews into Israel and the Israeli-occupied West Bank.