The Kurdistan Regional Government has changed course, declaring its commitment to Baghdad to retreat from territory that Kurdish forces have taken from ISIL.

On November 16, Masoud Barzani, the president of Iraq’s autonomous Kurdish region, said in a press conference that his soldiers would not retreat from the land “liberated with their blood” from the Islamic State in Iraq and the Levant group, also known as ISIL or ISIS.

“There will be no negotiations about the territories liberated by Peshmerga before the Mosul offensive,” Barzani declared. “This is a new chapter. ISIS is on the path to defeat. Peshmerga shed their blood to free Kurdistan’s land and end the suffering of our people.”

But the Kurdistan Regional Government, or KRG, later retracted Barazani remarks, saying that his comments, originally made in Kurdish, were taken out of context and “mistranslated”.

Nevertheless, Barzani’s comments revived long-standing fears among many Iraqis that the country’s Kurds are using the Mosul battle to seize land to incorporate into a future independent state.

Last September, Iraqi Prime Minister Haider al-Abadi asked Barzani not to exploit the war on ISIL to expand the Kurds’ territory.

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A former Iraqi army officer, who preferred not to be named because he lives in Iraq’s Kurdish region, told Al Jazeera that Kurdish fighters, known as Peshmerga, were taking advantage of the fight against ISIL to fulfil ambitions of statehood.

“In Kirkuk, for example, the Kurds are annoyed that some of the Arabs that were [in] brought by the former regime are growing in numbers,” the officer said, adding that Kurdish forces have destroyed homes belonging to Arabs under the pretext that their inhabitants support ISIL.

“They don’t target a house or two of those who are members or supporting ISIL – they wipe out the whole village,” he said.

The United States, which is leading an international coalition against ISIL, reportedly played a pivotal role in convincing Baghdad and Erbil to reach an agreement about the future of Mosul and surrounding areas before the start of the operation to retake the city, according to Hamid Mu’alla, a leading member of the Shia National Alliance and a spokesman for the Islamic Supreme Council of Iraq.

The parties to the agreement were said to have included the US, the Iraqi government, Shia militias known collectively as the Popular Mobilisation Forces (PMF), and the Kurdish regional government.

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In late September, Barzani visited Baghdad on the invitation of Iraqi Prime Minister Haider al-Abadi. “It was agreed that the battle for Mosul will be a clean battle,” Mu’alla told Al Jazeera.

“Compromises were reached … the border of Mosul must remain as it was before it fell to Daesh [the Arabic acronym for ISIL] without infringing upon the unity of the province… any future arrangement must have the consent of the people of Mosul,” Mu’alla said.

It was also agreed in the meeting that only Iraqi government forces and the PMF would be allowed to enter and pass through the KRG’s territory en route to ISIL-controlled areas in the Nineveh plains, according to an Iraqi source who asked not be identified for security reasons.

The Peshmerga, in return, would be allowed to remain in disputed territories, that is the territories they captured from ISIL after June 2014, until a referendum on self-determination is held in those areas. However, the Peshmerga were asked to retreat from territories captured during the recent Mosul military offensive.

Meanwhile, the US has denied it played such a role. “The United States can’t give rights to Iraq land to anyone,” according to a statement issued by the US military’s Combined Joint Task Force in Iraq sent to Al Jazeera.

The US embassy in Baghdad said in a statement sent to Al Jazeera that “the US encourages cooperation between the central government in Baghdad and the Kurdish Regional Government to address the country’s security situation and resolve any outstanding issues”.

The issue of disputed territories is thorny and complex, dating from before the rule of Saddam Hussein, and has made relations between Baghdad and Erbil uneasy over the past decade.

The two main Iraqi Kurdish parties – the Kurdistan Democratic Party (KDP), led by Masoud Barzani, and the Patriotic Union of Kurdistan (PUK), headed by Jalal Talabani – have annexed large swaths of land they say are a part of Iraqi Kurdistan, without the consent of the central government in Baghdad.

Iraq’s constitution, adopted in 2005, stipulates that a referendum be held on the fate of the oil-rich, ethnically diverse city of Kirkuk and other disputed areas in northern Iraq. But the referendum has still not been held, causing more tension and on occasion bringing the country to the brink of a new war.

When ISIL overran Mosul in June 2014, Kurdish security forces moved in to take land it considers to be Kurdish territory, then cut it off by digging trenches.

“The Kurds are not stupid. I don’t think they’ll concede … and give up the land,” says Mohammed al-Azdee, an Iraqi political analyst at the University of Bridgeport, in the US. “They’ve lost over 1,200 fighters, killed and wounded, not for the love of Baghdad but for their [own] interests and plans.”

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Meanwhile, concerns have arisen about the abuse of Arab civilians in areas captured by Kurdish forces. Human Rights Watch recently issued an alarming report suggesting that the Peshmerga may have committed war crimes, finding “a pattern of apparently unlawful demolitions of buildings and homes, and in many cases entire villages, between September 2014 and May 2016” carried out in Kirkuk and Nineveh governorates.

Jabar Yawar, the secretary-general and spokesman for the ministry of Peshmerga affairs, denied the accusations blaming “ISIL or people close to it who provide false information to the media and rights groups”.

“We do not cleanse Arab areas, why should we do this?” Yawar told Al Jazeera. “There is no policy to cleanse any ethnicity in the region. We have over 1.5 million in the Kurdish region, and a quarter of Erbil’s population is now Arab. Hundreds of Arabs own businesses here.”

Kurdish officials insisted that there was a “strategic intention” to destroy houses in recaptured areas due to the large number of improvised explosive devices found there.

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The political atmosphere in Iraq is tense and divisions are bitter, even among groups currently allied with one another. Analysts warn that the tensions between the KRG and Baghdad, as well as infighting among Iraqi Kurds, could fuel a proxy war between regional powers.

“There is [a] dire crisis between the KDP and PUK. The latter has strong relations with Iran and opposes the split from Iraq,” said al-Azdee. “The KDP and Barzani have good relations with Turkey … now there is a scenario that involves creating a new region made of Arabs and Kurds created on the new land seized from the Nineveh plains. Turkey wants that region as a buffer between Baghdad and Iran,” he explained.

Even if ISIL’s remaining territory in Iraq is retaken in the coming months, many challenges lie ahead for the country. The Kurdish quest for independence, sectarian strife and the settling of old scores all could trigger continued fighting.

“Reconciliation happens with the enemy, with people who you oppose … Why did some people support Daesh and help it [gain] a foothold in the first place?” asked al-Azdee. “That needs to be solved.”

Follow Omar Al Saleh on Twitter @AJEOmar