The State Department is struggling to make up its minds on the Iraqi Shi’ite militias in the ISIS war, declaring Iran to be financing “terror-related activities” for supporting those militias, which are the same militias fighting on the same side as the US in Iraq.
including Iran in the annual terror report at all is a risky decision, as Congressional hawks are likely to try to use this to block efforts to ease sanctions as part of the final nuclear deal, though they tried to thread the needle by insisting that Iran isn’t plotting against the US, and that the Shi’ite militias in Iraq aren’t either.
Ultimately though, putting Iran in the report is a surprising decision both for the impact on sanctions and what it might mean for US-Iraqi relations, since they are in bed with these same militias.
The US has pressed Iraq on the militias for quite some time, and has tried to sideline the Shi’ite militias in favor of Sunni factions in Anbar Province, hoping this will ease sectarian tensions. So far, though, there hasn’t been much in the way of Sunni militias to bring on board.