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$4.2Bln Arms Deal With Iraq May Be in Jeopardy

ReutersAl-Dulaimi speaking to the media during a news conference on Saturday.

BAGHDAD —†Iraq has canceled a $4.2 billion deal to buy military jets, helicopters and missiles from Russia, citing possible corruption in the contract, Prime Minister Nouri al-Maliki's office said.

Al-Maliki has suspicions about corruption on his own team, his spokesman told the BBC.

In a confusing exchange, the announcement was immediately contradicted by Iraq's acting defense minister, who denied the corruption charges and said the Russian arms deals were still valid.

The arms agreements were a sensitive issue for Iraq. U.S. military hardware remains key for Iraq's armed forces, but the Russian deal appeared to open a way for al-Maliki to push back against U.S. pressure by diversifying his arms suppliers.

The Russian sale was worked out just as Washington warned al-Maliki, who is close to Shiite-dominated Iran, to curb Iranian flights ferrying weapons through Iraqi airspace to aid Syrian President Bashar Assad in his fight against a revolt there.

Al-Maliki's media adviser, Ali al-Moussawi, said the decision to renegotiate the agreements had been made after the prime minister was informed about possible wrongdoing in the contract.

"Our need for weapons still stands, so we will renegotiate new contracts," al-Moussawi said. "This is a precautionary measure because of suspected corruption."

But acting Defense Minister Sadoon al-Dulaimi, who negotiated with the Russians, dismissed the corruption charges and said the deals would go ahead.

"We have not transferred even one dinar, there was no agent, no contract was signed. These were just technical and financial offers," he told reporters in Baghdad.

Arms exporter Rosoboronexport declined to comment. Interfax reported that the Russian Embassy in Iraq said it had not been informed that the deal had been scrapped.

The initial announcement of the deal was released unusually Ч in a Russian government document issued to reporters during al-Maliki's visit to Moscow in October.

The document said deals had been signed with Iraq's acting defense minister in April, July and August.

Kommersant said the contract entailed delivery of surface-to-air missiles and anti-aircraft artillery systems, MiG-29M/M2 aircraft, armored vehicles and attack helicopters.

The deals would have made Russia the second-largest military supplier to Iraq, after the U.S., which has sold Baghdad billions of dollars in arms, including F-16 fighters and tanks, since the 2003 invasion that ousted Saddam Hussein.

But the Russian agreements fit into the wider context of al-Maliki's efforts to balance interests stemming from the war against concerns regarding Assad.

Iran and Russia support Assad, while the rebels fighting him are backed by Saudi Arabia, Turkey and Western powers.

(Reuters, MT)

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