Iraqi Contracts With Iran and China Concern U.S.
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American officials fear that commercial investments in Iraqi power plants could mask military activities by Iran.
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Iraq is stepping up efforts to improve relations with neighbouring Iran, which has been highly critical of the military action against Shiite militias in Iraq.
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The top U.S. commander in Iraq  warned Iran and others in comments published on Monday to think  twice before trying to take advantage of the U.S. military at a  time when it is fighting in both Iraq and Afghanistan.
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Two years from now, during either a Kerry or Bush presidency, Iran will probably be much more of a security issue for the United States than Iraq.
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Iran has increased arms shipments to both Iraq's Shiite extremists and Afghanistan's Taliban in recent weeks in an apparent attempt to pressure American and other Western troops operating in its two strategic neighbors, according to senior U.S. and European officials.
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The Bush administration expressed  concern on Tuesday about Iran's pursuit of longer-range  ballistic missiles and imposed U.S. economic penalties against  Chinese companies it accused of helping Tehran in those  efforts.
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Iran said Wednesday it is considering whether to participate in a Baghdad-organized conference of Iraq's neighbors that its top rival, the United States, plans to attend.
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The United States on Wednesday slapped sanctions on an Iranian general from the elite Qods force as well as three Iraqis living in exile in Syria and Iran for fomenting violence in Iraq.
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Washington may want to label it a global terrorist organization. But in Iran the concern is over the military group's growing economic clout
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Iran could play a crucial role in curbing Iraq's Shiite militias if the U.S. opens a dialogue with Tehran as recommended by the Iraq Study Group, many in the Mideast say.
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The Bush administration cautioned Iran on Wednesday against trying to influence the outcome of Iraq's election, reacting to fears that Tehran is trying to produce a Shiite-dominated Islamic government in Baghdad.
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The Bush administration says it's not going soft on Iran, but Washington's new agreement to talk to the clerical regime about violence in Iraq could crack the door for other discussions with the last holdout among President Bush's old axis of evil.
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ON THE IRAQ-IRAN BORDER -- Since late August, British commandos in the deserts of far southeastern Iraq have been testing one of the most serious charges leveled by the United States against Iran: that Iran is secretly supplying weapons, parts, funding, and training for attacks on US-led forces in Iraq.
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In the wake of the Iraq invasion, there has been a faint but growing drumbeat sounded in Washington by officials who believe the Bush administration should now confront another member of its so-called &quot;axis of evil&quot; -- Iran.
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The economic impact of U.S. sanctions against Iran is unclear and since 2003 Iran's government has signed about $20 billion in energy contracts with foreign firms, a U.S. audit report said.
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Mainly because of the money, contract employees still want to head to Iraq.
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The U.S. military worried Sunday about "mixed messages" from Iran, listing a dramatic drop in Iranian-made weapons reaching Iraq but no reduction in the training and financing of Shiite militants.