By Fredrik Dahl
TEHRAN (Reuters) - Mirhossein Mousavi, seen as President Mahmoud Ahmadinejad's main challenger in Friday's election, advocates better ties with Iran's Western foes while rejecting their main demand -- a halt to sensitive nuclear work.
Hoping to win votes from reformers and conservatives, the former prime minister derides Ahmadinejad's "charity economy" policies, while urging a return to the "fundamental values" of the Islamic Republic's founder, Ayatollah Ruhollah Khomeini.
The bespectacled, bearded 67-year-old enjoys the support of reformist former President Mohammad Khatami and apparent backing from Khatami's pragmatic predecessor, Ali Akbar Rafsanjani.
But Mousavi's bid to unseat Ahmadinejad could be undermined by another contender, Mehdi Karoubi, whose liberal outlook could split the vote among those avid for political and social change.
After two decades out of the political limelight, Mousavi may also struggle for recognition -- many voters are too young to recall his stint as prime minister when he kept Iranians supplied with rationed goods in the 1980-88 war with Iraq.
Mousavi, running partly on that economic record, says he would seek detente with the West, curb inflation and create jobs if elected president of the world's fifth-largest oil producer.
He has promised to change the "extremist" image that Iran earned abroad under Ahmadinejad and has hit out at his profligate spending of petrodollars and cash handouts to the poor, which he says have stoked rising consumer prices.
But Mousavi, the son of a tea merchant, is also trying to carve inroads into Ahmadinejad's conservative support base, speaking of the need for "justice and freedom" while campaigning in the birthplace of Khomeini, Iran's late revolutionary leader.
Ahmadinejad won the 2005 election pledging to revive the values of the 1979 Islamic revolution and promising to share Iran's oil wealth more fairly among ordinary people.
"BREZHNEV, NOT GORBACHEV"
Like Ahmadinejad, Mousavi says Iran will not halt its nuclear program, but suggests he would do more to assure the West it is only for electricity generation not bomb-making.
"Mousavi's primary strength is that he could appeal to a broad segment of the electorate as he espouses a mix of conservative and reformist tenets," said Cliff Kupchan of risk consultancy Eurasia Group.
Breaking new ground in Iranian politics, Mousavi's wife Zahra Rahnavard is actively campaigning for him. The couple even hold hands at rallies, rare public behavior for politicians in the socially conservative, mainly Shi'ite state.
A prominent artist and academic in her own right, Rahnavard may help her architect and painter husband draw women voters.
"She is popular among educated women," said editor-in-chief Hamid Najafi of Kayhan International, a conservative daily. "I think Mousavi will be a tough competitor for Ahmadinejad."
But his strategy of trying to appeal to voters across the political spectrum risks alienating some reformers seeking a more radical break with the Ahmadinejad era.
His relationship with Supreme Leader Ayatollah Ali Khamenei, is a topic of speculation. The two men, distant relatives, had differences in the 1980s when Khamenei was president. Khamenei called on voters this month to back an anti-Western candidate.
Should he win, Mousavi is "likely to tweak, rather than overhaul, the Islamic Republic. Think Leonid Brezhnev, not Mikhail Gorbachev," Syracuse University political science professor Mehrzad Boroujerdi wrote in Foreign Policy magazine.
Mousavi, who favored a big role for the state in Iran's war-time economy, now advocates economic liberalization. He says he would control inflation through monetary policies and would also make life easier for private business.
"Mousavi has mostly been known for his left-wing statist economic views. However, he appears to be endorsing a more liberal agenda this time around," said London-based risk consultant Karabekir Akkoyunlu of AKE Ltd.
(Additional reporting by Parisa Hafezi; Editing by Alistair Lyon)