These include F-16 fighter jets and M1A1 main battle tanks, the same systems the Americans used to crush Saddam Hussein in 2003.

That's a bonanza for U.S. defense contractors, who increasingly rely on exports to keep production lines running for U.S. forces, and should keep Iraq, Iran's western neighbor, in the U.S. military orbit for the next couple of decades.

U.S. officials say about half the contracts involved have been finalized, with the others still under negotiation.

Russia, Britain, China, France and others have been seeking to get pieces of the multibillion-dollar Iraqi arms deals.

In May, Baghdad was reported to be negotiating with Britain's BAE Systems for 24 Hawk jet trainers in a deal worth up to $1.6 billion, but nothing seems to have come of that yet.

Moscow, Saddam's main arms supplier in the 1980s, delivered 26 Mi-17 medium transport and multirole helicopters for two squadrons in 2007. These can be fitted with rockets.

But the Americans are expected to secure bigger helicopter deals -- 24 Boeing AH-6 Apache gunships and 24 Bell 407s, a contract worth up to $2.4 billion.

Virginia-based General Dynamics has already won a U.S. Army contract valued at $198 million to produce 140 of the Abrams tanks for Iraq under the Foreign Military Sales program.

The tanks will be built in Lima, Ohio; Scranton, Pa; Anniston, Ala.; and Tallahassee, Fla.

The Iraqi army, restructured and trained by the Americans, now has 14 divisions and is primarily equipped for counterinsurgency operations.

Eventually the focus will switch to countering external foes, although with insurgents led by al-Qaida continuing attacks as the Americans draw down their forces, that might be some time in coming.

U.S. commanders question the Iraqis' ability to overwhelm the insurgents and sectarian militias, and there is a possibility that Baghdad may request a U.S. military presence past the scheduled completion of the withdrawal in late 2011.

But in the meantime, the immediate plan for the Iraqi ground forces appears to be fielding two tank battalions with Abrams and 10 artillery batteries with 120mm light guns over the next year.

The fledgling post-Saddam Iraqi air force is scheduled to be equipped with 18 Lockheed Martin F-16 multirole Falcon fighters, enough to equip one squadron.

It's a modest beginning, but these would be the air force's first combat aircraft, acquired as part of a $3 billion program that will also encompass training and maintenance.

"Iraq's a sovereign country but let's be frank," said Lt. Gen. Anwar Hamad Ahmed, the air force commander. "We don't have the combat or jet fighters or interceptor planes or air-defense systems.

"We're still far from an air force's full potential. We'll need the U.S. long after 2011."

The F-16 sale is awaiting the congressional green light, and the first jets could be delivered in early 2013.

The Iraqis have requested 96 F-16s through 2020, enough for five squadrons. U.S. Army Gen. Ray Odierno, the U.S. commander in Iraq until Sept. 1, said deliveries would likely be completed by the time the U.S. withdrawal is scheduled to end in late 2011.

But the Americans appear wary of giving the Iraqis high-profile offensive capabilities. Iraq's neighbors retain harsh memories of Saddam's catastrophic military adventures.

The first was the September 1980 invasion eastward into Iran's Khuzestan oil region. That led to an eight-year war in the Gulf that caused an estimated 1 million casualties.

Two years after that conflict ended in a stalemate, Saddam invaded Kuwait to the south in August 1990 to seize its oil fields. The Iraqis were driven out in February 1991 by a U.S.-led coalition.

But Iraq's defense chiefs argue that, despite U.S. misgivings, the country needs to be able to deter an attack from outside. Even though Saddam has gone, Iraq's neighbors, including Iran, Saudi Arabia, Syria and Turkey, remain suspicious of the political and sectarian turmoil that persists in Iraq.

The new air force currently has some 76 non-combat aircraft and this is scheduled to be increased to around 130, including U.S.-supplied C-130 Hercules turboprop transports built by Bethesda-based Lockheed Martin.

At least six C-130J Hercules are slotted to go to Iraq, with associated services and training in a package that could total $1.5 billion.

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