"We all have a role to play in confronting extremism. That's why I have invited important Muslim and non-Muslim figures to join the new Community Engagement Forum, so I can hear directly about their work in our communities, the challenges they face and so that they can be part of our One Nation strategy to defeat it," Cameron said.
"I want to build a national coalition to challenge and speak out against extremists and the poison they peddle. I want British Muslims to know we will back them to stand against those who spread hate and to counter the narrative which says Muslims do not feel British.
The move brings Islamophobia in line with anti-Semitic attacks targeting Jews, which have been recorded separately for years in the country.
The announcement came as hate crimes, or offences based on prejudice over personal characteristics, registered an 18 per cent rise in England and Wales in 2014-15.
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According to the latest UK Home Office figures, police recorded 52,528 hate crimes in 2014-15, up from 44,471 in 2013-14. More than 80 per cent were categorised as race hate crimes, with others involving religion, disability, sexual orientation and transgender victims.
"Working with police to provide a breakdown in religious- based hate crime data will help forces to build community trust, target their resources and enable the public to hold them to account," Theresea said.
The announcement coincided with a new report released in the Parliament to find out the extent of Islamophobia in the country.
Among the most shocking was an account of a Muslim woman who was showered in alcohol in a violent attack on a train as other passengers silently watched on, the Tell MAMA (Measuring Anti-Muslim Attacks) report said.
"Participants argued that anti-Muslim hate must be challenged from within Muslim communities - too often reluctant to report abuse or attacks - and that the public should intervene and assist victims of anti-Muslim hate where possible," he said.