WASHINGTON - Iran is a major obstacle to the U.S. vision of a Middle East in which nations will "trade more, invest more, talk more and work more constructively to solve problems," Secretary of State Condoleezza Rice says.

"The Iranian government is pursuing policies which are detrimental to the long-term interests of its neighbors, of the region, and of the Iranian people themselves. It need not be this way," Rice said in remarks prepared for delivery Wednesday to a House panel.

Rice’s testimony, obtained by the Associated Press, before the House Foreign Affairs Committee, comes amid increased frustration by Republicans and Democrats alike that the Bush administration is not doing enough to deter Iran's nuclear ambitions.

Last month, the House passed, by a 397-16 vote, legislation aimed at blocking foreign investment in Iran, in particular its lucrative energy sector. The bill, sponsored by Foreign Affairs Committee Chairman Rep. Tom Lantos, D-Calif., would specifically bar the president from waiving U.S. sanctions.

Rice said the administration shares Congress' goal of making sanctions tougher on Iran, but urged caution.

"We simply want to be certain that our collective efforts do not undermine our multilateral strategy, where we will have a maximum chance of success," she said.

President Bush says a U.S.-linked missile defense system is urgently needed in Europe to protect against a potential Iranian strike. Plans for such a system have strained U.S. relations with Russia, which estimates Iran’s capability to be less mature and has close financial ties with Tehran.

On Tuesday, Defense Secretary Robert Gates said the Bush administration has told Moscow it may delay activation of the system until it has proof that Iran poses a missile threat.

"We would consider tying together activation of the sites in Poland and the Czech Republic with definitive proof of the threat - in other words, Iranian missile testing and so on," Gates said.

Rice planned to tell the House committee Wednesday that in addition to nuclear ambitions that undermine stability in the region, Tehran has provided "lethal assistance" to extremist groups in Lebanon, Afghanistan and the Palestinian territories, as well as Iraq.

In particular, she noted, activities in Iraq by the Iranian Revolutionary Guard Corps’ Quds force "are inconsistent with the Iranian government’s obligations and stated commitment to support the Iraqi government."