US Defence Secretary Ashton Carter on Wednesday urged NATO allies to do more to help the US-led anti-Islamic State coalition finish the job in Iraq and Syria and destroy the jihadi group.

NATO defence ministers earlier agreed to extend training of Iraqi troops from Jordan to Iraq itself and to consider deploying AWACS surveillance aircraft.

"I would like to see NATO do more," Carter told reporters after ministers met at the alliance HQ in Brussels.

"I believe there is still more NATO can do to hasten the destruction of ISIL," he said, using another name for IS.

IS seized large swathes of territory in Iraq and Syria, scattering government and rebel troops with ease, but Washington has marshalled its allies inside NATO and out to help force the jihadists back from key areas.

Most of the 28 NATO member states contribute to the anti-IS coalition individually but the alliance itself as an organisation has no direct role in the campaign.

With IS increasingly on the defensive and losing ground, Carter said NATO could make a "meaningful contribution," helping consolidate coalition gains while government forces press on.

Asked if NATO's offer to increase training of Iraqi officers and the possible AWACS deployment were modest compared with what others were doing, Carter insisted that was far from the case.

"There is no way that is secondary, that is very important... it is not peripheral," he said.

NATO leaders will announce a final decision on the Iraq training mission and AWACS planes at their July 8-9 summit in Warsaw.

State Dept. deal calls for Iraq aircraft support
Washington (UPI) Jun 15, 2016 - The U.S. State Department has approved a possible foreign military sale to Iraq for AC-208 Combat Caravan sustainment, logistics and spares support worth $181 million.

The Defense Security Cooperation Agency, which manages the U.S. Foreign Military Sales program, notified Congress of the possible sale Tuesday.

Baghdad has requested the sale of a five-year sustainment package for its AC/RC-208 fleet that includes operational, intermediate and depot-level maintenance, spare parts, component repair, publication updates, maintenance training and logistics.

The proposed sale would also include contract logistics, training and engineering services.

The sustainment package would allow Iraq's air force to continue operating its eight C-208 light attack and intelligence, surveillance and reconnaissance aircraft beyond the end of its existing contract logistics service contract, which expires this month, the agency said.

"Ultimately, the goal is for the [Iraq air force] to become self-sufficient in the areas of aircraft maintenance and logistics training," the agency said. "Iraq will have no difficulty absorbing this support."

Orbital ATK and Flight Safety International would be the principal contractors.

The AC-208 is based off ATK's Cessna 208 Caravan aircraft. It provides intelligence, surveillance and reconnaissance capabilities and can be armed with Hellfire missiles.