CAIRO Egypt's main hardline Islamist party says an IMF loan agreement requires the approval of a body of Muslim scholars under the new constitution and it is considering legal action to make sure the government sticks to the law.
The case could set a marker on the extent to which clerics will have a say over state affairs according to the Islamist-tinged constitution that was signed into law in December following its approval in a referendum.
The Salafist Nour Party says the loan agreement, seen as vital to easing a deep economic crisis, must be approved by a body of senior scholars at Al-Azhar, a religious institution whose new role is embedded in the constitution.
Such a challenge could complicate the Muslim Brotherhood-led administration's effort to finalize the International Monetary Fund deal that was tentatively agreed last year but shelved following political unrest in Cairo.
Abdullah Badran, head of the Nour Party's bloc in the upper house of parliament, told Reuters the move was intended to "activate the role of the Senior Scholars' Authority in all matters pertaining to sharia (Islamic law)". He said the party was studying its legal options.
The Nour Party believes the IMF agreement must be vetted by the scholars because it includes a loan on which Egypt will pay interest - something that is forbidden under Islamic law.
The constitution states that the opinion of Al-Azhar's Senior Scholars' Authority must be sought "on matters pertaining to Islamic sharia". It does not say whether their opinion is binding on government nor make clear the scope of Al-Azhar's role.
The article is one of several written into the constitution by the Islamist-dominated committee that finalized the document in December, fast-tracking it into law despite the objections of liberals, leftists, feminists and Christians, among others.
The party has previously signaled it would not oppose such a loan on principle, citing arguments that allow Muslims flexibility in interpreting Islamic law when they have no alternative or face severe conditions.
The interest on any IMF loan is expected to be around 1.1 percent, far below market rates.
Badran said the party's main concern was to make the government apply the new constitution. "There are many reasons which must be researched for either taking the loan or not," he said.
"Our request is that the opinion of the Senior Scholars' Association be taken, on this agreement or other agreements (related to sharia)," he said.
The government has said IMF negotiators are due in Cairo soon to complete talks on the loan agreement, which would require Egypt to agree to a set of economic reforms including tax increases and cuts in subsidy spending.
Many economists, however, believe final ratification of the agreement could be pushed back to mid-year as the politicians try to avoid upsetting voters ahead of parliamentary elections due in April.
(Editing by Paul Taylor)