AN independent commission set up by Congress with the approval of President George W Bush may recommend carving up Iraq into three highly autonomous regions, according to well informed sources.

The Iraq Study Group, co-chaired by James Baker, the former US secretary of state, is preparing to report after next month’s congressional elections amid signs that sectarian violence and attacks on coalition forces are spiralling out of control. The conflict is claiming the lives of 100 civilians a day and bombings have reached record levels.

The Baker commission has grown increasingly interested in the idea of splitting the Shi’ite, Sunni and Kurdish regions of Iraq as the only alternative to what Baker calls “cutting and running” or “staying the course”.

“The Kurds already effectively have their own area,” said a source close to the group. “The federalisation of Iraq is going to take place one way or another. The challenge for the Iraqis is how to work that through.”

The commission is considered to represent a last chance for fresh thinking on Iraq, where mass kidnappings are increasing and even the police are suspected of being responsible for a growing number of atrocities.

Baker, 76, an old Bush family friend who was secretary of state during the first Gulf war in 1991, said last week that he met the president frequently to discuss “policy and personnel”.

His group will not advise “partition”, but is believed to favour a division of the country that will devolve power and security to the regions, leaving a skeletal national government in Baghdad in charge of foreign affairs, border protection and the distribution of oil revenue.

The Iraqi government will be encouraged to hold a constitutional conference paving the way for greater devolution. Iran and Syria will be urged to back a regional settlement that could be brokered at an international conference.

Baker, a leading exponent of shuttle diplomacy, has already met representatives of the Syrian government and is planning to see the Iranian ambassador to the United Nations in New York. “My view is you don’t just talk to your friends,” he said last week. “You need to talk to your enemies in order to move forward diplomatically towards peace.”

His group has yet to reach a final conclusion, but there is a growing consensus that America can neither pour more soldiers into Iraq nor suffer mounting casualties without any sign of progress. It is thought to support embedding more high-quality American military advisers in the Iraqi security forces rather than maintaining high troop levels in the country indefinitely.

Frustrated by the failure of a recent so-called “battle of Baghdad” to stem violence in the capital, Zalmay Khalilzad, the US ambassador to Iraq, said last week that the unity government of Nouri al-Maliki, the prime minister, had only two months left to get a grip. Rumours abound that the much-admired ambassador could depart by Christmas.

Khalilzad’s warning was reinforced by John Warner, Republican chairman of the Senate armed services committee, on his return from a visit to Baghdad. “In two to three months’ time, if this thing hasn’t come to fruition and this government (is not) able to function, I think it’s a responsibility of our government internally to determine: is there a change of course we should take?” Warner said.

Bush and Condoleezza Rice, the secretary of state, have resisted the break-up of Iraq on the grounds that it could lead to more violence, but are thought to be reconsidering. “They have finally noticed that the country is being partitioned by civil war and ethnic cleansing is already a daily event,” said Leslie Gelb, former president of the Council on Foreign Relations.

Gelb is the co-author with Senator Joseph Biden, a leading Democrat, of a plan to divide Iraq. “There was almost no support for our idea until very recently, when all the other ideas being advocated failed,” Gelb said.

In Baghdad last week Rice indicated that time was running out for the Iraqi government to resolve the division of oil wealth and changes to the constitution.

Many Kurds are already hoping for their own national state, while the Shi’ite Islamist leader Abdul Aziz al-Hakim is pressing for regional autonomy. The Sunnis are opposed to a carve-up of Iraq, which would further deprive them of the national power they enjoyed under Saddam Hussein and could leave them with a barren tranche of the country bereft of oil revenue.

Many Middle East experts are horrified by the difficulty of dividing the nation. “Fifty-three per cent of the population of Iraq live in four cities and three of them are mixed,” said Anthony Cordesman of the Washington-based Centre for Strategic and International Studies, who fears a bloody outcome.

Baghdad is a particular jumble, although ethnic cleansing is already dividing the population along the Tigris River, with Shi’ites to the east and Sunnis to the west of the city.

America may have passed the point where it can determine Iraq’s future, according to Cordesman: “The internal politics of Iraq have taken on a momentum of their own.”

Gelb is under no illusions about the prospects of success. “Everything is a long shot at this point,” he said.

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