DIYALA STANDOFF RECEDES BUT GOI-KRG TENSIONS

C O N F I D E N T I A L SECTION 01 OF 02 BAGHDAD 002820 SIPDIS E.O. 12958: DECL: 09/02/2018 TAGS: PREL PGOV PINS PINR IZ SUBJECT: DIYALA STANDOFF RECEDES BUT GOI-KRG TENSIONS CONTINUE Classified By: POL MinCouns Robert S. Ford for reasons 1.4 (b,d). ¶1. (C) The standoff in the northeastern Diyala province town of Khanaqin between Kurdish Peshmerga and the Iraqi Army (IA) forces appears to have passed its most dangerous phase, but an armed showdown between KRG and GOI security forces in this or another disputed territory remains a threat. Deputy Prime Minister Barham Salih and Water Resources Minister Rashed in separate de-briefs to us recounted that a meeting August 31 evening between Prime Minister Maliki and four top Kurdish leaders (including Salih and Rashed) produced a compromise that should forestall hostilities for the time being: Kurd-dominated security forces will remain inside Khanaqin city, the IA will stay outside the city but retain control of nearby roads and checkpoints, the IA will conduct counterterrorism operations inside Khanaqin only in coordination with the KRG, and all sides will cease hostile rhetoric in the press. KRG Representative to Baghdad Dilshad Miran told us the evening of September 1 that Maliki's previous September 5 deadline for all KRG security forces to withdraw behind the Green Line is no longer operative, and the Kurds no longer plan demonstrations in Khanaqin on September 6 and 7. We judge that this is probably sufficient to prevent a military confrontation for now, and are urging both sides to avoid provocative troop maneuvers that could undermine the tentative deal. ¶2. (C) The dispute underlying the Khanaqin confrontation, however, remains unresolved. Salih said the episode demonstrates that a battle is coming - "hopefully not a military battle" - that will redefine the KRG-GOI relationship. He told us that Maliki attempting to alter the balance of power that has governed the last five years of Arab-Kurdish relations in Iraq, and that Maliki feels he must now confront Kurdish "militias" after having taken on both Sunni and Shia Arabs in recent months. On the GOI side, National Security Advisor Rubai'e told PolMinCouns on the margins of the September 1 Anbar PIC ceremony that the Prime Minister would not concede on deploying Iraqi forces up to the Green Line, stating flatly that eventually they should deploy into Khanaqin. In the meantime, Rubai'e claimed, the Peshmerga at the end of August had increased their presence in and around Khanaqin and Kurdish personnel were insulting Iraqi army personnel. PolMinCouns noted that we were urging both sides to be careful and avoid unilateral actions that could be interpreted as provocative. Rubai'e asked if the U.S. was urging the Kurds to withdraw their security forces in Diyala to positions north of the Green Line. He was visibly displeased when PolMinCouns said we were not saying that to the Kurds, calling this stance "unhelpful." PolMinCouns noted that the principle about which Rubai'e was speaking could be applied to Kurdish security personnel (including Sayesh security service personnel) in and around Kirkuk, where deploying Iraqi army personnel could trigger a fight. Rubai'e said the Iraqi government would work out deploying units into Kirkuk later; for now, he said, the issue is Khanaqin. ¶3. (C) Barham Salih September 1 told us that USG influence "is waning," and Maliki's posture in Diyala suggest that he shares that perception, as both Kurds and the Iraqi Government are increasingly willing to make bold moves in defense of their perceived self-interest. A worst-case scenario, according to Salih, would be a similar confrontation over Kirkuk, which the Kurds will be far more willing to defend belligerently and which would arouse far more Arab passion if Maliki were to demand that the Kurds depart. Water Minister Rashed was less alarmist than Salih; he thought the Prime Minister's team and the Kurdish leadership could find a deal. Rashed and Salih both, however, noted that the relationship between Barzani and Maliki had deteriorated sharply. Both men claimed that Barzani feels personally betrayed by Maliki after Kurdish help to Nouri al-Maliki before the fall of the Saddam regime. ¶4. (C) Comment: Given the deep-rooted tensions that underpin these disputes, there appears to be a need for serious and far-reaching negotiations on the future relationship between the GOI and KRG. Salih and other Kurdish leaders are now telling us a "grand bargain" is the only way to resolve these outstanding issues - the DPM argued that Kirkuk cannot be resolved without discussing the hydrocarbon law and vice versa, and we are inclined to agree. Of equal importance to the Kurds is their perception that Maliki increasingly is bypassing his partners in what should be a national unity government - in the Diyala/Khanaqin operations, for example, IA Chief of Staff Babakir Zebari (a Kurd) allegedly had almost no role. There is no guarantee that the parties can reach a suitable bargain on these large issues, but the often tense standoff in Khanaqin demonstrated the perils of letting them fester. End Comment. BAGHDAD 00002820 002 OF 002 BUTENIS