Doha has a history of reaching out to all kinds of controversial groups, from rebels in Sudan's Darfur to the Taliban in Afghanistan and Hamas in Gaza. Qatar touts itself as a neutral player that can act as an intermediary. Its critics, notably Saudi Arabia and the UAE, say it uses such interventions to play both sides and fund radical Islamist groups, most recently in Libya and Syria.

To Doha's critics, the hostage deal was further evidence of that role. "If you want to know how Qatar funds jihadis, look no further than the hostage deal," said a Syrian opposition figure. "And this isn't the first - it is one of a series since the beginning of the war."

Doha could have paid off rival Iran

The Financial Times spoke to people involved on both sides of the hostage swap, including two government officials, three Iraqi Shia militia leaders and two Syrian opposition figures.

About $US700 million was paid both to Iranian figures and the regional Shia militias they support, according to regional officials. They added that $US200 million to $US300 million went to Islamist groups in Syria, most of that to Tahrir al-Sham, a group with links to al-Qaeda. Those who spoke to the FT said it highlights how Qatar has allegedly used hostage payments to bankroll jihadis in Syria. To its Gulf neighbours, the biggest issue is likely to be the fact that Doha could have paid off Iran, its main regional rival, which they accuse of fuelling conflicts in the Arab world.

Qataris enjoy a promenade in Doha. The country has one of the highest levels of GDP per capita in the world. Kamran Jebreili

This particular stage began when an Iranian-backed Iraqi Shia militia, Kata'ib Hizbollah, kidnapped the Qataris in December 2015. Three Iraqi militia leaders say the hostages were held in Iran. Kata'ib Hizbollah is an Iraqi group but is seen as having links with Iran's main regional proxy, Hizbollah, the Lebanese militant group. The latter is helping Iran back Syrian President Bashar al-Assad in the six-year Syrian conflict.

Two diplomats said they believed one of the Iraqi group's motives for the kidnapping was to provide Hizbollah and Iran leverage to negotiate the release of Shia fighters kidnapped by the radical Sunni group Tahrir al-Sham in Syria, which, in previous iterations, was an al-Qaeda branch.


The hostage transaction was also linked to a separate agreement to facilitate the evacuation of towns in Syria - two surrounded by jihadis and two besieged by Shia militias - Syrian rebels and diplomats say.

One western diplomat said: "Iran and Qatar had long been looking for a cover to do this [hostage] deal, and they finally found it."

Qatar, a US ally that hosts an American military base, has long drawn the ire of its neighbours who consider it an irritating maverick.

According to two opposition figures, Qatar used the evacuation arrangement to pay $US120 million -$1US40 million to Tahrir al-Sham. Another $80m, they said, went to the Islamist group Ahrar al-Sham.

"The Qataris pay anyone and everyone, to what end? They have only brought about our ruin," said a Syrian rebel commander.

An Arab official said the total paid to jihadi groups was closer to $US300 million. "So, if you add that up to the other $US700 million they paid to Iran and its proxies, that means Qatar actually spent about a billion dollars on this crazy deal," he said.

The Iraqi Shia militia commanders in Iraq said that Iran had obtained about $US400 million after giving them a payment. They agreed to share details because they were unhappy about their share.

Another confusing aspect of the deal is that Iraqi prime minister Haidar al-Abadi said in April his government seized millions of dollars, which officials said arrived on Qatari planes "illegally". It is unclear if this money is part of the sums above, or an additional amount.

"The money all came in suitcases, can you imagine this?" said one official.

Additional reporting by Simeon Kerr in Dubai

Financial Times