A rebranded ISIL declares 'Islamic caliphate'

Militants whose sweeping offensive has captured swathes of Iraq have declared an "Islamic caliphate" in their territory as Iraqi forces battle to retake Saddam Hussein's hometown Tikrit.

Known until Sunday as the Islamic State of Iraq and the Levant (ISIL), the group rebranded itself as simply 'the Islamic State' (IS) on Sunday and announced it was establishing a "caliphate" - an Islamic form of government last seen under the Ottoman Empire - extending from Aleppo in northern Syria to Diyala in Iraq, the regions where the group has fought against the regimes in power.

Though the move may not have a significant impact on the ground, it is an indicator of the group's confidence.

The crisis in Iraq is said to rival the brutal sectarian war of 2006-2007, with more than 1,000 killed and hundreds of thousands displaced within weeks.

Alarmed world leaders have urged a speeding up of government formation following April elections, warning the conflict cannot be resolved by force alone. 

The onslaught that the newly renamed IS led this month overran parts of five Iraqi provinces after capturing the Syrian province of Deir Ezzor near Iraq, Raqqa in the north, and parts of Aleppo province.

Its leader Baghdadi, who once spent time in an American military prison in Iraq, is touted within IS as a battlefield tactician, and is increasingly seen as even more powerful than al-Qaeda leader Ayman al-Zawahiri.

Experts say the announcement of the caliphate could open a new era of militancy with a powerful new leadership.

The caliphate is "the biggest development in international jihad since September 11", said Charles Lister of the Brookings Institution in Doha, referring to the Al-Qaeda attacks on the United States.

"It could mark the birth of a new era of transnational jihadism... and that poses a real danger to al-Qaeda and its leadership," the expert said, adding that IS with members in many countries is the richest jihadist group.

IS's announcement came as Iraq took delivery of the first batch of warplanes from Russia, with the newly-purchased Su-25s expected to be pressed into service soon.