Cameron announces Sharia law finance plans for UK

David Cameron has announced plans to issue a Sharia law bond in the UK, making it the first non-Muslim country to do so.

But Bishop Nazir-Ali warned against the move, saying dabbling with Sharia law could lead to “unforeseen consequences” for the Government.

The Prime Minister set out proposals to issue the £200 million bond at the World Islamic Economic Forum last week.


To comply with Sharia law, the bond is a form of debt which charges no interest.

Mr Cameron also announced plans for a new Islamic index on the London Stock Exchange.

He said: “I don’t just want London to be a great capital of Islamic finance in the Western world, I want London to stand alongside Dubai as one of the great capitals of Islamic finance anywhere in the world”.


Bishop Nazir-Ali raised concerns about the effects of the proposals.

He said: “This means that the Government itself will be subject to sharia in its dealings on these bonds.”

He added: “At the moment the issue is pretty modest, but how much will it grow?”


The Bishop said it may lead to a situation where a “major part” of the financial system is governed by “sharia-compliant considerations”.

The treasury is expected to launch the bond next year, and will bring in a fixed return from a tangible asset or service, without charging interest.

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