"On Iran, Hagel noted that while the United States intends to test the prospect for a diplomatic solution with Iran we remain clear eyed about the challenges ahead and will not waver from our firm policy to prevent Iran from obtaining nuclear weapons," Pentagon Press Secretary George Little said after the meeting between the two leaders.
During the meeting, Hagel applauded the announcement by the Organisation for the Prohibition of Chemical Weapons (OPCW) that the destruction of chemical weapons in Syria has started.
"While much works remains to be done, this recent progress is a step in the right direction to eliminating this threat," Little said.
Hagel and Ya'alon also discussed progress on the United States' effort to increase Israel's qualitative military edge with advanced capabilities that the US Defence Secretary announced on his visit to Israel earlier this year, the spokesman said.
Meanwhile, the Wall Street Journal reported that Iran is preparing a package of proposals to halt production of near-weapons-grade nuclear fuel, a key demand of the US and other global powers.
Tehran in return will request that the US and European Union begin scaling back sanctions that have left it largely frozen out of the international financial system and isolated its oil industry, officials said, according to the financial daily.
"The Iranians are preparing to go to Geneva with a serious package. These include limits on the numbers of centrifuges operating, enrichment amounts and the need for verification," a former Western diplomat who has discussed the incentives with senior Iranian diplomats in recent weeks was quoted as saying.
Iran is preparing to put forth these proposals at the P5 plus One meeting in Geneva next week.
P5 plus one includes the five permanent members of the UN Security Council -- the United States, France, Britain, Russia and China -- and Germany.
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