Iraqi Prime Minister Mohammed Shia Al-Sudani held talks with Steven Fagin, the top U.S. diplomat in Iraq, on Sunday, as Washington presses Baghdad to crack down on Iranian-backed armed groups accused of destabilizing the country.

The meeting focused on strengthening bilateral relations and expanding cooperation across economic, security, and political sectors. According to a statement from Al-Sudani’s office, both sides also discussed regional tensions and stressed the need for international efforts to prevent further conflict in the Middle East.

The talks came a day after the U.S. State Department reiterated concerns about Iran-aligned factions within Iraq’s Popular Mobilization Forces (PMF), urging Baghdad to take stronger action against groups tied to attacks on American troops.

A State Department said that some PMF units maintain ties to designated terrorist organizations and engage in activities that threaten Iraq’s security. Washington has long criticized factions such as Kataib Hezbollah and Asaib Ahl al-Haq, which are sanctioned for their links to Iran’s Revolutionary Guards and alleged involvement in targeting U.S. forces.

While Al-Sudani’s government has vowed to curb militia violence, analysts say pro-Iranian groups still operate with impunity. The U.S. has repeatedly called for accountability, but Iraq faces political challenges in reigning in the powerful factions.

The meeting underscores Iraq’s precarious position as it navigates relations with both Washington and Tehran. With regional tensions high, Baghdad remains a key battleground in the U.S.-Iran rivalry.

No major agreements were announced, but the discussions signal continued U.S. engagement with Iraq. The Biden administration has emphasized diplomacy, even as it pressures Baghdad to rein in militias.

For now, Iraq’s ability to counter Iranian influence while maintaining stability remains a critical test for Al-Sudani’s government.