Investors from Muslim countries will shy away from Iraq unless stability returns and a representative government is elected, delegates at a conference of the world's largest Islamic group said.

"It will be difficult for investors to commit capital and people when there is a possibility they will be abducted," Mirzan Mahathir, the son of former premier Dr Mahathir Mohamad, told AFP at a meeting of business leaders of the 57-member Organisation of the Islamic Conference (OIC).

Mirzan, the executive chairman of Konsortium Logistic Bhd, which is involved in warehousing and transport, added: "It is very disturbing and sad because we have a nation in turmoil and everbody is trying to see how to achieve stability, but nobody has the right solution right now."

The upcoming elections in Iraq will play a crucial role, said Salahuddin Kasem Khan, president of the Bangladesh-Malaysia Chamber of Commerce and Industry.

"The whole election process must be under the umbrella of the United Nations and not under any system which would ultimately determine the outcome," he said.

"This (pre-determined outcome) will not bring stability to Iraq and I think OIC countries would be very reluctant if there is no genuine representation, to come forward."

He added: "They don't want to get into this conflict. For example, Bangladesh has been asked to send troops but we don't want to, in this situation, where there's no security."

Initiative needed

Iraq must elect a permanent government in order to woo more investors, said Aqeel Al-Jassem, secretary-general of the Pakistan-based Islamic Chamber of Commerce and Industry.

Aqeel, a Kuwaiti national, said: "We (OIC countries) are doing our best. We are contacting Iraqi businessmen, and we received some positive response. Now what they need is to regain stability first."

"We should give incentives for the business community. Businessmen should go and visit the country and explore its potentials," said Attiya Nazawish Ali, assistant secretary general of the Islamic Chamber of Commerce and Industry.

"It isn't at the moment stable, but you cannot keep waiting for when that time will come. An initiative has to be taken and someone should take the initiative. Once you go and enter the market, stability will automatically come," she said.