Hundreds of demonstrators took to the streets in Indian Kashmir and Pakistan, while Indonesia, the world's most populous Muslim nation, criticised the timing of the honour.

Rushdie was given the award on Saturday, 18 years after he was sentenced to death by Iran's hardline clerical regime for writing what it said was a blasphemous book, "The Satanic Verses".

The Pakistani Ulema Council, a private body that claims to be the biggest of its kind in the country with 2,000 scholars, said it had given al-Qaeda chief Bin Laden its "highest title for a Muslim warrior."

"We are pleased to award the title of Saifullah (sword of Allah) to Osama bin Laden after the British government's decision to bestow the title of 'Sir' on blasphemer Rushdie," council chairman Maulana Tahir Ashrafi told AFP.

Bin Laden has been blamed for the September 11, 2001 attacks on New York and Washington that killed nearly 3,000 people. He is widely believed to be hiding on the Pakistan-Afghanistan border.

Later Afzal Sahi -- the speaker of the Punjab province assembly and a member of the Pakistan Muslim League party that backs President Pervez Musharraf -- said during a debate that he would obey his duty as a Muslim to murder Rushdie.

"If this man comes in front of me I will definitely kill him," he said.