Al-Sadr has indicated he is interested in creating a political party that could take part in elections early next year, according to Reuters.
"I kept on saying consistently that if I were in his shoes I would try to go to the political arena instead of raising arms," al-Yawer told reporters. "He has supporters, he has constituents, he should go through the political process and I commend this smart move on his side."
President Bush said it was up to the Iraqi government whether to welcome al-Sadr, whom a U.S. general at one point swore to kill or capture, into the fold.
"The interim Iraqi government will deal with al-Sadr in the way they see fit," he said, Reuters reported. "They're sovereign. When we say we transfer full sovereignty, we mean we transfer full sovereignty."
Al-Sadr launched a bloody uprising against U.S.-led coalition forces in the southern holy cities of Najaf and Karbala two months ago. He has since agreed to a truce under pressure from other Shiite religious leaders.
Although an arrest warrant has been issued against al-Sadr for allegedly murdering a rival cleric in Najaf last year, al-Yawer said the young cleric is innocent until proven guilty and could enter Iraqi politics as soon as he disbands his al-Mahdi Army militia, according to Reuters.
Also Tuesday, interim Iraqi Prime Minister Iyad Allawi said captured former dictator Saddam Hussein and other detainees would be turned over to the Iraqi authorities in the next two weeks, and Saddam would stand trail "as soon as possible," the Associated Press reported.
President Bush agreed that the United States would turn over the deposed dictator but did not give a specific time frame.
"I want to make sure that when sovereignty is transferred, Saddam Hussein stays in jail," Mr. Bush told reporters.
He said the United States was working with Iraqis on the terms of Saddam's handover and to ensure appropriate security is in place.
Saddam has been in U.S. custody in an undisclosed location since his capture in December.