The agreement to buy the T-50IQ aircraft was inked on Thursday during a ceremony held in Baghdad, the government said in a statement.

Iraqi Prime Minister Nouri al-Maliki hailed the signing "as a starting point" to improve the performance of the Iraqi security forces in order to defend the country and confront terrorist groups.

Korea Aerospace Industries said on its official website that it would support services for the aircraft for 20 years, which could push the total value of the deal to more than $ 2 billion.

The T-50IQ aircraft is an advanced multi-role fighter that possesses precision-guided weapons, missiles and machine guns.

Iraq is trying to rebuild its air force which saw huge damage over the past two decades in the Persian Gulf war in 1991 and the US-led invasion of the country in 2003.

Iraq presently does not have high-speed, high-altitude military planes and has used helicopters to provide support during operations, which are vulnerable to ground fire.

Baghdad has also ordered 36 F-16 warplanes from the United States.

BA/BA