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The Eastern Caliphate is the eastern portions of the former Great Caliphate, consisting of territory from Palestine to Persia, and including Turkey and Arabia. The entire "Middle East" is within the Eastern Caliphate's borders. The Eastern Caliphate claims to be the 'true' caliphate and the 'true' home of Islam, a claim it based on the fact that the holy cities of Mecca and Jerusalem are contained within it. Most governments recognise the Eastern Caliphate as a political entity - the Western Caliphate does not, and maintains that the Eastern Caliphate is an illegal government and that its territory is an integral part of the Great Caliphate. The Great Caliphate no longer exists; both the East and West governments, in Baghdad and Cairo respectively, claim to be the legitimate government of the Great Caliphate and that the other is not.
The Eastern Caliphate unilaterally seceded from the Great Caliphate in 1990. The catalyst for the ensuing civil war was the invasion of the Kuwait province by Saddam Hussein, Grand Mufti of Baghdad. The invasion, conducted using Saddam's personal armies, was a violation of an accord that had kept the various Arab states from feuding since the 1800s, and the government of the Great Caliphate, then based in Mecca, dispatched troops to deal with Saddam. Backed by England and the U.S., as well as Russia, Saddam was able to maintain his hold on Kuwait and declared his territory independent from the Caliphate. The Civil War lasted until 1995, when a 'demilitarised zone' was drawn up in Palestine marking the boundary between the Eastern and Western Caliphates. Saddam and his followers had seized control of Caliphate territory east of the DMZ, and it became the Eastern Caliphate under Saddam's rule. Contrary to expectations, Saddam did not declare himself Caliph, but instead arranged for his ally, Grand Ayatollah al-Sistani, to be appointed to the position. Saddam moved the capital away from Mecca to his home city of Baghdad, in the interests of 'protecting the Holy City from infidels'. Saddam and the Eastern Caliphate claim al-Sistani as the true Caliph, a fact disputed by the Cairo administration of the Western Caliphate. While the two Caliphates are in a nominal state of ceasefire, border skirmishes and suicide bombers are common, particularly in Egypt and Palestine.
In 2003, a rise in Islamic terrorism directed against England led to an invasion by England and the U.S. in an attempt to depose Saddam and end his alleged support for Islamic extremism. The invasion initially went well, but Saddam Hussein himself could not be located. After seven months of searching, the English government declared victory and announced Saddam was dead. When Saddam emerged from hiding three days later, it put pressure on the governments in London and Washington. It then transpired that the leaders of both countries had manufactured evidence against Saddam in order to launch an invasion with the objective of gaining access to Iraqi oil wealth. The invasion was halted, all English and U.S. troops were withdrawn, and Saddam Hussein emerged stronger and more popular than ever.
Saddam Hussein is the "leader of the Islamic people" but holds no official title. Officially, the government is a theocracy led by the Caliph, Ayatollah al-Sistani, who claims to be the leader of all Muslims. Others reject this claim. In practice, the Eastern Caliphate is a dictatorship under Saddam Hussein's personal jurisdiction.