According to the decree, Hashd al-Shaabi (Popular Mobilization Unit) will be granted many of the same rights as members the military, Reuters reported.
They will be given equivalent salaries to those in the military under the Defense Ministry’s control, the decree said.
They will also be subject to the laws of military service and will be able to access to military institutes and colleges.
The decree had been expected for some time and comes two months ahead of a high-stakes general election.
The fighters have played a major role in the liberation of Daesh-held areas to the south, northeast and north of the Iraqi capital Baghdad, ever since the terrorists launched an offensive in the country in June 2014.
Iraq has repeatedly condemned allegations of sectarian nature against Hashd al-Shaabi.
In December 2016, Baghdad warned Riyadh of the ramifications of meddling in Iraq’s internal affairs, after Saudi Foreign Minister Adel al-Jubeir said Iraq cannot realize unity with the presence of the Popular Mobilization Units.
Saudi Arabia has repeatedly labeled the PMU, which incorporates volunteer forces from different Iraqi factions and tribes, as a Shiite movement and called for the dismantling of the group.