BAGHDAD (Reuters) - An alliance between Iraq's two main Shi'ite political coalitions to form the next government is far from concluded, with potentially divisive issues such as the nomination of a prime minister still unresolved.
The announcement this week that Shi'ite Prime Minister Nuri al-Maliki's State of Law bloc and the Iraqi National Alliance (INA) would join forces in parliament was seen as a reminder to their Sunni-backed rival, Iraqiya, that the next prime minister will come from the major Shi'ite coalitions.
The strong showing by the cross-sectarian Iraqiya, led by secular Shi'ite former Prime Minister Iyad Allawi, has raised Sunni expectations of a large role in government. Violence could ensue if they feel sidelined by majority Shi'ites.
But the Shi'ite tie-up did not include a deal on a prime minister, a main stumbling block to forming a new government after a March 7 parliamentary election.
It produced no clear winner and left Iraq adrift in dangerous political uncertainty. The results of the election have not even been certified to date.
"I don't think this would be a final agreement," Iraqi political analyst Ibrahim al-Sumaidaie said.
"The State of Law thinks it solved half of the problem of Maliki's getting the premiership and the INA thinks it solved half of the problem of pushing Maliki aside from the premiership," Sumaidaie said.
The March election was seen as a watershed for Iraq as it emerges from the violence set off by the 2003 U.S.-led invasion and sets out to attract foreign investment and develop its vast oilfields while U.S. forces prepare to withdraw.
Yet, while the election was declared largely free and fair, the results have faced a slew of challenges that have delayed a final tally and the formation of a new government.
State of Law, which won 89 seats -- two less than Iraqiya -- and INA said weeks ago that they intended to merge in parliament. But both camps had said talks had stalled over the issue of the prime minister.
Maliki wants another term but is opposed by a key faction of INA, the Sadrist political movement of anti-American cleric Moqtada al-Sadr. The Sadrists hold around 40 of INA's 70 seats.
The alliance talks were put on hold after State of Law successfully sought a recount of votes in Baghdad, hoping that might overturn Iraqiya's lead, and while a panel considered what to do with candidates accused of links to Saddam Hussein's outlawed Baath party.
Neither issue has been concluded. That made Tuesday's announcement a bit of a puzzle.
Mohammed al-Darraji of the Sadrists said consensus on how to select a prime minister was far from finalised.
"We have not agreed on the mechanism of choosing the prime minister ... Who will rule Iraq will be a compromise candidate," said Darraji. "Not agreeing on the prime minister could be the knot obstructing the political process."
An agreement signed by the two alliances requires them to form a committee to study possible candidates and to pick a single nominee, said Amir al-Kenani, another Sadrist.
The pact says the parties could consult religious leaders to resolve disputes but does not give the final say to a small group of Shi'ite clerics led by Grand Ayatollah Ali al-Sistani, Iraq's most revered Shi'ite cleric, Kenani said.
"There is no obligation, as some people imagine," he said.
Leading Iraqiya politician Osama al-Nujaifi accused neighbouring Shi'ite Iran of masterminding the planned Shi'ite alliance. But he ruled out the possibility of Iraqiya being totally excluded from the new government.
"The alliance between (Maliki's) State of Law and INA was expected and there are Iranian pressures in this direction," said Nujaifi, a senior Sunni politician.
"But of course ... Iraqiya will be present in the parliament in a large number and can't be overlooked."
(Additional reporting by Khalid al-Ansary and Reuters Television; Editing by Michael Christie and Jon Boyle)