* Iran faces tightening financial, other sanctions
* Islamic state resorting to barter to import basic goods
* Sweden: Pension payments to its citizens in Iran affected
VIENNA, Feb 17 (Reuters) - Toughening financial sanctions on Iran are making it difficult for Sweden to pay pensions to people with dual citizenship who have retired in the Islamic Republic, the Nordic nation's foreign minister said on Friday.
Carl Bildt's comments were the latest indication of how punitive steps by the West to force Iran to back down over its disputed nuclear programme can have an impact on ordinary people, in this case Iranians who also have Swedish citizenship.
Tens of thousands of people of Iranian descent live in Sweden - ahving moved there during the rule of the U.S.-backed shah or after he was ousted in the 1979 Islamic Revolution.
After retiring, those who moved back may now have problems collecting their Swedish pensions, which could amount to a substantial sum of money in Iran, where many people earn the equivalent of a few hundred U.S. dollars per month.
"We are having difficulties to manage pension payments to Swedish citizens who live in Iran and that is not really good," Bildt told Reuters during a visit to Vienna, adding it was not a question of a large number of people.
He did not give details, but appeared to refer to growing problems in transferring money to and from Iran, one of the world's largest oil producers.
Western sanctions are spreading to block Iran's oil exports and central bank financing of trade, and Tehran has resorted to barter and other unorthodox ways to import staples like rice, cooking oil and tea, commodities traders say.
The Obama administration is pressing the European Union and SWIFT, the global organisation that facilitates most of the world's cross-border payments, to expel Iranian banks from its network, a new step in the push to starve Iran of funds.
Bildt said U.S. measures were having the biggest impact, suggesting the 27-nation EU had tried to avoid designing sanctions in a way that would have excessively "dramatic effects" on individuals.
Tension has soared in recent months in the long-running dispute over Iran's nuclear programme, which the West suspects is aimed at developing nuclear weapons capability but Tehran says is an entirely peaceful quest for electricity generation.
Speculation has mounted that Israel, which sees Iran's nuclear activities as a mortal threat, may launch pre-emptive military strikes against Iranian nuclear sites.
Bildt rejected any such steps, saying there were no military solutions to the dispute and that the Middle East was already in a "volatile and dangerous situation". (Reporting by Fredrik Dahl; Editing by Mark Heinrich)
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