The Islamic State (IS) or the Islamic State of Iraq and the Levant (ISIS) stormed Iraq in 2014 with its takeover of major Iraqi and Syrian cities by exploiting Sunni Arab grievances in Iraq and chaos in the neighbouring Syria. But the militant group is steadily losing ground in both the countries. The so-called caliphate is on the back foot. Even some analysts predicated that the IS has, more or less, passed the peak of its military power on the Syrian and Iraqi battlefields. If the IS continues to lose territory at the same pace, some people believe that the year 2016 could well be its last to one function as a pseudo state. The IS has lost about 45 percent of its territory in Syria and 20 percent in Iraq since the peak of its control in August 2014, according to estimates by some American analysts. With every town and village that is lost, the group also loses income that comes from fines and taxes. Their oil industry has been bombed — its main source of funding — and supply lines into Turkey almost cut. The overall effect of all these losses on the group’s funding, leadership, arms, propaganda communications and manpower is immense, and it surely degrades the group’s fighting capabilities. The CIA now estimates that the IS currently has 20,000 to 25,000 fighters on the ground, which is the lowest force level since the end of 2014. The IS’s ability to function as a military pseudo-state is troubled because it is finding it difficult to replenish its armed ranks. Various forces are squeezing the caliphate at multiple points simultaneously, and the ISIS cannot resist everywhere. Even the current affiliates of the IS in North Africa and the Arabian Peninsula face stiff competition from local rival groups and rising counterterrorism pressure from their states. But forcing the IS out of the cities and territories that it currently holds is unlikely to lead to its demise. The ISIS may revert to its previous tactics on the lines of an insurgency; there would be sleeper cells, bombings, kidnappings and assassinations. It is going to be an ongoing process, and the IS even after losing its core territory can run a bloody deadly insurgency for years. The IS is a hybrid organisation. Its members with disparate backgrounds combine to transform an insurgent force into a formidable army that can shift from acting like a guerrilla militia to a conventional army, all the while fighting on multiple fronts hundreds of miles away from its logistical bases. The core of the IS is the former Saddam Hussain-era army and intelligence officers, particularly from the Republican Guards, which provide the IS with good military strategy when its combined with insurgency experience of its fighters who come from various parts of the world. Then it makes the IS a very different type of a terrorist organisation that can fight as a conventional force and can even run an insurgency campaign. The IS can find other unstable places on the globe that it can use as its base. At present, Libya looks the most promising. It has just the kind of failed-state anarchy, the “savagery” that leaves room for the jihadists to move in, forging alliances with local militants and disgruntled supporters of the overthrown regime. Just like Iraq. Moreover, the IS — the best-funded terrorist organisation history has ever seen — can run a successful insurgency campaign with its deep pockets. The group financing is certainly more reminiscent of a state than that of organisations such as the al-Qaeda, which relied heavily on donations to fund their operations. So it would be erroneous to assume that the IS would simply melt away by suffering military defeats in Syria and Iraq. With its surviving fighters the IS can certainly engage in guerrilla warfare in the whole of the Middle East, and in direct or inspired suicidal bombing operations within its global network. Already, the group has stepped up the pace of suicide bombings in Baghdad, Damascus, and elsewhere in an apparent attempt to assert its presence even as it is defeated on the ground. Both the military and counterinsurgency strategy is required for the complete defeat of the IS. The core assumption of any counterinsurgency strategy is that the enemy has significant support in the communities from which it recruits and gets support. The aim of effective counterinsurgency strategy is to deny the enemy any propaganda victories that can further fuel its recruitment and support base. Unfortunately, the ISIS is very good in its propaganda war; it always tries to show the ongoing war in the region as a new form of crusade that its soldiers are fighting for to “defend the faith.” We should not allow the IS to brand itself as the icon of global jihadism, broadening its affiliate and allegiance-based networks. As such, a longer-term strategy needs to be developed, which includes prevention of further proliferation of the group within the Middle East and beyond. This approach needs to address ways of decreasing the group’s appeal within the region. Also, the local divisions and regional sectarianism that fuelled the rise of the IS should also be taken care off, so that the IS could not return to the places from where it was driven out. The writer is a columnist for the Middle East and Afghanistan-Pakistan region, and Editor of ViewAround, a geopolitical news agency. He can be reached at manishraiva@gmail.com