Iraq, U.S. working to agree pact by July deadline

BAGHDAD (Reuters) - Iraq said on Wednesday it was committed to meeting a deadline for a long-term security pact with the United States, as Washington confirmed it dropped a demand concerning the divisive issue of immunity for private contractors.

The two countries are negotiating a new security deal to provide a legal basis for U.S. troops to stay in Iraq after a United Nations mandate expires on Dec. 31, and a separate long-term agreement on political, economic and security ties.

After five years in Iraq, President George W. Bush's administration has set an end-July target for wrapping up the negotiations, even as some Iraqi officials have questioned whether that timetable can be met.

An Iraqi government statement said Foreign Minister Hoshiyar Zebari had discussed with U.S. Vice President Dick Cheney in Washington on Tuesday "the need to conclude" the long-term strategic framework agreement.

"Both agreed the importance of completing this agreement before the end of July to avoid any legal vacuum that may arise as a result of the U.N. mandate expiring," it said.

That came just days after Iraqi Prime Minister Nuri al-Maliki said talks on the security pact were at a stalemate because of U.S. demands that encroached on Iraq's sovereignty.

One U.S. demand, however, has been taken off the table, according to a senior U.S. military official in Washington.

That official, speaking on condition of anonymity, said the Bush administration is no longer seeking legal immunity for private contractors working in Iraq, a troubling prospect for many Iraqis who see the contractors as a security force that operates with little accountability.

"That's been taken off the table now ... There's just no precedent for that. The Iraqis know that," he said.