One can well understand the jubilation in Iraq over the withdrawal of American troops from the urban areas, but it remains to be seen whether all parties and political forces will turn this into an opportunity, and work for the country’s consolidation. The end of Shia-Sunni fighting has been a positive development, but that alone is not going to give stability to Iraq.

The recent bombings, including the one in Kirkuk that killed 26 people on Tuesday, show that terrorism is very much alive. One challenge to stability comes from self-governed Kurdistan. It has oil, and that adds to the tension in its relations with the Baghdad government headed by Prime Minister Nuri al-Maliki. Recently the Kurdistan government signed some oil deals with foreign companies, which evoked a sharp rebuke from Baghdad. The latter told the oil companies that all contracts with Kurdistan would be illegal unless they were ratified by the centre.

Iraq’s own oil production — 2.2 million bpd — is far below its potential at this time. The government needs money because it has to undertake the huge task of rebuilding Iraq’s infrastructure. A most important job is to rehabilitate the two million internally displaced persons and the 1.5 million refugees abroad. The representative of the United Nations High Commissioner for Refugees recently warned that Iraq was ‘too fragile’ to absorb the refugees.

The IDPs too cannot return to their cities because the homes of most of them have been destroyed. All eyes are now fixed on the January election, and Mr Maliki and his Dawa party seem determined to retain power. The opposition has accused him of arresting dissidents and using strong-arm methods to tighten his grip over thedministration with an eye on the January election. All Iraqi factions have to realise the gravity of the task facing them in the aftermath of the American withdrawal. The total withdrawal is still more than two years away. A worsening of the law and order situation could make America reschedule its withdrawal, and that will only increase dissensions and give a new lease of life to terrorism.