TEHRAN; Mahmoud Ahmadinejad was sworn in for a second term as Iran president on Wednesday, vowing more defiance of the West at a ceremony boycotted by his rivals, as police in full riot gear broke up protests by opposition demonstrators.

The 52-year-old hardliner took the oath of office for another four years at a ceremony in parliament after his landslide election victory in June that triggered the worst turmoil in the Islamic republic's history.

In a speech outlining his plans for the future, Ahmadinejad said he would continue to resist "oppressive powers," dismissing the US stance towards Iran and hailing his election as a sign of major change in Iran.

But prominent opposition leaders were absent from the ceremony, and outside a force of about 1,000 riot police and Basij volunteer Islamic militiamen used pepper spray on demonstrators who claim his election was rigged, witnesses said.

Protesters chanted "Death to the Dictator" and anti-Ahmadinejad slogans, booing the security forces as police and Basij moved in to disperse them, a witness said, while several were reportedly arrested.

Wednesday's ceremony was boycotted by powerful cleric Akbar Hashemi Rafsanjani and Ahmadinejad's main defeated challenger Mir Hossein Mousavi, who vowed that the opposition movement would go on despite a campaign of arrests.

Despite the international outcry over the election and its brutal aftermath, some foreign diplomats were present, including envoys from Britain, France and Sweden, which currently holds the EU presidency.

Ahmadinejad now has a two-week deadline to form a new government that is likely to remain on a collision course with the West, particularly over Iran's controversial nuclear drive.

"We will resist oppressors and try to correct the global discriminatory mechanisms in order to benefit all the nations of the world," Ahmadinejad said.

"The June 12 epic is the start of major change in Iran and in the world."

He said Iranians should play a "more effective role" in global affairs, and pledged to fight for social justice, saying: "Special economic privileges which are the source of discrimination and corruption must be uprooted."

Ahmadinejad took aim at the United States after the White House acknowledged him as the "elected" president of Iran, but stopped short of declaring him the legitimate president and said it had no plans to congratulate him.

"This means they only want democracy which serves their interests and they don't respect people's votes and rights," Ahmadinejad retorted. "Iranians will neither value your scowling and bullying nor your smiles and greetings."

Under President Barack Obama, Washington has made overtures for dialogue with Iran after three decades of severed ties, but Tehran has failed to respond and vowed to press on with its nuclear work.

Hours after Ahmadinejad's broadside, US Secretary of State Hillary Clinton paid tribute to Iran's opposition movement.

"We appreciate and we admire the continuing resistance and ongoing efforts by the reformers to make the changes that the Iranian people deserve," Clinton told reporters in Kenya, where she kicked off a seven-nation Africa tour.

Although enjoying grass-roots support among the poor, Ahmadinejad's re-election set off massive street protests, leading to a raft of political trials and increasing divisions among the ruling elite.

About 30 people were killed in the violence, hundreds wounded and around 2,000 initially arrested, while around 110 have been put on trial.

A reformist newspaper said on Wednesday that a Mousavi aide and a newspaper editor who supported him in his election campaign had been arrested.

"Some thought that by arresting several people who they believe are protest leaders, the whole question will be finished," Mousavi said in a statement on his website.

"But the fact is that this movement has stayed alive, showing that the arrests will not be effective."

A hardline group Basij Seminary Students and Clerics, however, called for the punishment of protesters whom it said were rebelling against the revolution.

"Identify those in any position... who deceived the Muslim Iranian nation with an aim to eventually defeat the Islamic revolution and consider them as rebels... and punish them," it said in an open letter to the chief of judiciary Ayatollah Mahmoud Hashemi Shahrudi.

Ahmadinejad's presidency was formally endorsed on Monday by supreme leader Ayatollah Ali Khamenei, who described him as "courageous" but warned him that the "angry, wounded opposition" would continue challenging his government.