Attention has been focused on the Sunni Muslim insurgency against US-led forces further north, yet the British have been facing a sharp rise in attacks from an increasingly sophisticated and deadly foe.

There are strong suspicions that the bloodshed is being orchestrated with weapons and encouragement from Iran.

The clashes and the arrest of two undercover soldiers was almost certainly triggered by the arrest at the weekend of Sheikh Ahmed al-Fartusi, the leader of the Mahdi Army, a banned militia loyal to Moqtada al-Sadr. He was seized by British troops in a raid that also netted his brother and another colleague. “The operation is the result of an ongoing multinational force investigation that identified individuals believed to be responsible for organising terrorist attacks against multinational forces,” said a statement released by the British military on Sunday after the deaths of six British soldiers and two security guards over the past two months.

Al-Sadr’s supporters are known to dominate the local police and can mobilise gunmen or mass protests at short notice, as they did regularly during an uprising last year that swept across southern Iraq.

British officials are convinced that Iran is implicated in the upsurge in violence and suspect it may be connected to Britain’s hardening position against Tehran’s nuclear programme. Britain has been working closely with Iran over the past two years to reach a compromise. But with the victory last month of the hawkish President Ahmadinejad, Iran has hardened its position.

Britain is now actively lobbying to have Tehran referred to the UN Security Council, where it could face sanctions.

Iran’s policy in Iraq is co-ordinated by the Supreme National Security Council — the body responsible for running its atomic industry. “The Iranians are careful not to be caught,” a British official said. “But they like to stoke up the temperature in Iraq when it suits them.”

Apart from the activities of al-Sadr’s supporters, military intelligence has concluded that Iran has been supporting a local terror group run by Abu Mustafa al-Sheibani, who is blamed for the murder of at least 11 British soldiers.

In a secret report, military intelligence warned commanders that attacks on British forces were being deliberately intensified, with the use of a new bomb, developed in Iran, that can penetrate the thickest armoured protection.

Al-Sheibani’s group is said to have an estimated 280 fighters, divided into 17 bomb-making teams.

One of al-Sheibani’s bombs, a passive infra-red device, is blamed for the deaths of Second Lieutenant Richard Shearer, 26, Private Leon Spicer, 26, and Private Phillip Hewett, 21, of the Staffordshire Regiment, in the Risaala neighbourhood of central al-Amarah, near the Iranian border in July.

A similar roadside device was used six weeks ago against a British embassy convoy in Basra that killed two British bodyguards.

The report, drawn up by British and US experts, said that al-Sheibani’s group was being investigated for its role in the murders of six Royal Military policemen in June 2003 by a mob in Majar al-Kabir.

RECENT ATTACKS

July 16 Second Lieutenant Richard Shearer and Privates Phillip Hewett and Leon Spicer are killed by a roadside bomb

July 30 Two British security guards are killed in a roadside bomb attack on a diplomatic convoy

Aug 2 US reporter Steven Vincent kidnapped and murdered

Aug 22 First civilian flight into Basra International Airport

Aug 25 Responsibility for basic military training is handed over to the Iraqi Army

Sept 5 Fusiliers Donal Meade and Stephen Manning killed by bomb

Sept 11 Major Matthew Bacon killed by bomb

Sept 16 Sheikh Ahmed al-Fartusi, the local leader of cleric Moqtada al-Sadr’s Mahdi militia, arrested at his Basra home

Times Recommends

• 8,000 miles from Washington - Obama's grandmother
• Review: Oliver Stone's W.
• Zimbabwe chaos wipes out education