Blair welcomes new Iraqi cabinet
Mr Blair said the new government
marked a "critical moment"
The approval of a new Iraqi government of national unity marks a "huge step forward", Tony Blair has said.
The PM said the administration had a programme for the country's security and reconstruction and the potential to create a "different Iraq".
Mr Blair said an exit strategy for UK forces depended on how the cabinet responded to the "critical moment".
Earlier, the Ministry of Defence said two UK soldiers received minor injuries after a roadside bomb outside Basra.
British-led troops were on a routine patrol north west of Basra when they were attacked, an MoD spokesman said.
'Tough decisions'
Mr Blair said despite the continued violence, the creation of the 37-minister team - the first full-term government since the 2003 conflict - indicated most Iraqis were behind "proper democratically elected government".
"You're not going to be able to tell that until you look back on it," he said.
"But the fact that you've got a government for the first time that is one of genuine national unity, voted for by over 12 million people, I think that is a very crucial change in Iraq."
Mr Blair added that coalition troops would continue to support Iraqi forces for as long as necessary.
"We want a transfer to the Iraqis as soon as we can but it has got to be based on the Iraqi force capability being up to the job.
"We need to make sure that we stay until the job is done," he said.
'Tough decisions'
The announcement that Iraq's parliament had approved a new government, including members of the main Shia, Kurd and Sunni parties, has also been welcomed by the UK's Foreign Secretary Margaret Beckett.
She said the UK would continue to help the Iraqi people "face these challenges for as long as Iraq needs us".
"If both Iraq and the international community are to defeat those who advocate violence, the new Iraqi government is going to have to take tough decisions on building democratic structures, building up their security forces and developing their economy," she said.
Tensions over the cabinet's make-up remain, though, and three crucial ministries - national security, interior and defence - have still not been agreed.
The UK's top military officer in Iraq General Robert Fry said the new government would need help to maintain security for some time.
"If security has to be provided here for an extended period of time then that is what needs to happen," he told the BBC.
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