Currently Britain has about 7,100 troops stationed in around Basra.
Josh Rushing, Al Jazeera's military analyst, said the British move could cause problems for the Bush administration which is trying to argue for an escalation in US troops in Iraq when its main ally seems to be pulling out.
"Has any of the Bush Iraq plans worked other than causing the worst destruction?"
Zaffar Zohair, Islamabad, Pakistan
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Washington is planning to send some extra 21,000 troops into Iraq in addition to the 138,000 already there, in a last-ditch effort to restore security in the country.
Peak of 46,000 UK troops deployed for 2003 invasion
Some 7,100 still serving in Iraq, several hundred others on ships in Gulf
132 UK soldiers have died in Iraq since 2003
British operations in Iraq under codenamed Operation TELIC
Troops largely deployed in southern Iraq mainly based in Basra, small number also based in Baghdad
10 soldiers killed in aircraft crash in early 2005, single largest loss of life for British troops
Total cost to UK of Iraq war to date: about $7.8 bn