Update to this story.
Via Telegraph:
David Cameron’s plans to issue sharia-compliant bonds open the way to Islamic law being enforced at the heart of government, a senior clergyman has warned.
Dr Michael Nazir-Ali, the former bishop of Rochester, said proposals to make Britain the first non-Muslim country to sell a bond that complies with sharia could trigger a series of “unforeseen consequences”.
He also voiced broader fears that Christianity was being increasingly excluded from the administration of law, after one of Britain’s most senior judges said members of the judiciary were “secular” figures serving a “multicultural community”.
Last week the Prime Minister set out plans for Britain to issue a sukuk, a form of debt that is in line with Islamic law, because it avoids the prohibited use of “riba”, or interest.
Speaking at the World Islamic Economic Forum in London on Tuesday Mr Cameron said Britain should rival Dubai as one of the “great capitals of Islamic finance”. […]
However, Dr Nazir-Ali, who holds dual British and Pakistani citizenship, said of the plans: “This means that the Government itself will be subject to sharia in its dealings on these bonds.
“At the moment the issue is pretty modest, but how much will it grow? There’s a lot of liquidity out there and it could grow pretty rapidly, and then you may face a situation where a major part of your financial system is governed by sharia-compliant considerations.”
He added: “Before we take these steps that could have unforeseen consequences we do need greater public discussion, greater explanation of what actually is being done and what it is we are letting ourselves in for.”
The bishop said that a public debate on the introduction of the bonds should include whether sharia judges should be allowed to adjudicate in disputes over government-backed investments.