Iraqi officials are expected to request compensation from Paris for receiving 14 French Daesh suspects sent to Baghdad for trial, according to diplomats.
The alleged jihadists are being moved to the capital from Kurdish camps in northeastern Syria.
Speculation of the request comes after French President Emmanuel Macron met with Iraqi Prime Minister Adil Abdul-Mahdi at the Elysee Palace on Friday. At a press conference, he pledged further financial and political assistance, announcing that France was ready to assist with Iraq's reconstruction.
"The French development agency will soon set up in Baghdad with increased resources to help you," Macron said.
Though he did not broach the subject of foreign fighters at the conference, French officials said it was discussed and that a financial compensation request is expected soon.
In recent months, Western countries have been confronted with the decision of what to do with their citizens held by Kurdish Syrian Democratic Forces (SDF) in Syria and Iraq.
There are an estimated 1,000 Western Daesh fighters in custody despite the SDF calling for them to be tried in their home countries.
Analysts say Baghdad could be compensated as much as $2 billion for its role in sentencing and imprisoning Western jihadists.
At the peak of the so-called "caliphate", there were 40,000 foreign fighters in Iraq and Syria. Of those, around 2,000 were French nationals. Some 300 are estimated to have died during the conflict.
The US has called on EU members to play their part and to convict their own fighters. In February, US President Donald Trump tweeted: "The United States is asking Britain, France, Germany and other European allies to take back over 800 Isis [Daesh] fighters that we captured in Syria and put them on trial."
The United States is asking Britain, France, Germany and other European allies to take back over 800 ISIS fighters that we captured in Syria and put them on trial. The Caliphate is ready to fall. The alternative is not a good one in that we will be forced to release them……..
— Donald J. Trump (@realDonaldTrump) February 17, 2019
He added that without the EU's repatriation, the US and SDF would have to release the fighters. The US also fears that detainees could escape from Kurdish detention facilities and regroup in northeastern Syria.
Last month, a French tribunal quashed the appeal of family members of Daesh children to have them return. France's Interior Minister, Christophe Castaner, has not ruled out repatriating fighters, but said there would be "no communal repatriation" and that decisions would be made on a "case by case" basis.
Rights groups and families have said that it's wrong for authorities to punish children for their parent's actions.
Despite Iraq claiming "final victory" over Daesh in 2017, sleeper cells still operate across the country and random attacks are frequent.
Last night, three Iraqi policemen were killed by gunmen at an Iraqi Federal Guard post near the road leading from Erbil to Kirkuk in the Kurdish controlled region of the country. A Kurdish news site referred to it as a "terrorist" attack and noted that Iraq's US-trained anti-terrorism services had been conducting a number of operations in the area over the past month.