Small party breaks away from Iraq Shi'ite bloc

BAGHDAD, March 7 (Reuters) An Iraqi Shi'ite Islamist party said today it was withdrawing from the powerful Shi'ite coalition that has dominated politics since 2005 elections, in a move Shi'ite officials said was a challenge to the government.

The Fadhila party, which holds 15 of parliament's 275 seats, said it was open to join other blocs as long as they weren't formed on a sectarian basis. The move may weaken the ruling United Iraqi Alliance, which has a near majority in parliament.

Officials from the Alliance, parliament's largest bloc, were annoyed and said they feared Fadhila's withdrawal was part of larger plans by other parties to form a rival bloc in parliament in order to overthrow Nuri al-Maliki's government.

''This is a surprise for us,'' said a senior Alliance official.

''It is definitely bad news for the Alliance. I fear it might fracture the Alliance.'' Nadim al-Jabiri, a senior Fadhila official said that the party was leaving the dominant Shi'ite bloc and will sit in parliament as an independent party awaiting moves from other political blocs to launch a ''patriotic'' agenda.

''We consider the first step of saving Iraq is to dismantle these blocs and to prevent blocs forming on a sectarian basis,'' Jabiri told a news conference in Baghdad's fortified greenzone.

The Alliance was formed just before the elections in 2005 with the blessing of top Shi'ite cleric Grand Ayatollah Ali al- Sistani with the main goal of protecting the interests of the Shi'ite majority, oppressed under Saddam Hussein.

''New coalitions are being formed in an attempt to weaken the government and eventually overthrow it,'' senior Alliance official Bahaa Araji told Reuters.

''But all these attempts will fail. What is built on bad intentions will not last,'' he said.

Sunni Arabs and ethnic Kurds also formed blocs on sectarian and ethnic backgrounds to run in the 2005 elections.

Since then sectarian divisions have increased, fuelled by violence which surged after the bombing of a Shi'ite shrine in Samarra a year ago.

Fadhila has long been at odds with the six other major parties inside the Shi'ite bloc and stayed away from Maliki's government when it did not receive the Oil Ministry.

Araji, a senior member in the bloc loyal to fiery Shi'ite cleric Moqtada al-Sadr, said that Fadhila announced their withdrawal because they did not receive firm promises that they will be included in the cabinet after a reshuffle which Maliki has said will happen soon.

Fadhila, which is influential in the oil-producing region of Basra, could now be courted to join a new coalition with former Prime Minister Iyad Allawi's secular bloc alongside the main Sunni bloc in parliament that aims to offer a counterweight to the Alliance.

''We do not think that the timing of this announcement serves the Iraqi people,'' said Araji.

Two Shi'ite Alliance sources said they feared that Fadhila move could open the way for other parties in the Alliance to break away including the Sadrists. But Araji said the movement was not planning to split from the Alliance.

REUTERS SP PM1937