The bonfire, in Moygashel in County Tyrone, Northern Ireland, has featured other controversial displays in the past.
The former senior PSNI officer Roy McComb said the risks for officers trying to “access something at the height” would have taken time and created tension in the community.
“It’s not something that police would have been able to react to with any great amount of speed given the complexity and logistical challenges,” he said.
Sinn Féin Economy Minister Caoimhe Archibald said it “was not the first time we have seen horrible racist displays on this bonfire”.
She added that there is no place for such displays.
The Democratic Unionist Party’s (DUP) Community Minister Gordon Lyons said bonfires play an important role in the culture of Northern Ireland but added “there is no place for the burning of flags or effigies” and they should always be respectful.
He also warned against “demonising” all cultural celebrations as he said the overwhelming number of bonfires in Northern Ireland will pass off without concern.
Social Democratic and Labour Party councillor for the area, Karol McQuade, described organisers of the bonfire as “attention seeking”.
He said: “There’s fear in the community in Moygashel. There’s fear in the Muslim community.”
Alliance MLA and policing board member Peter McReynolds said he received “messages of fear from the Muslim community most of yesterday”, including a doctor who has lived in Northern Ireland for 20 years but is now considering leaving.
He told the Nolan Show: “It’s not acceptable, and I think the condemnation from politicians needs to be a lot stronger.”
The Archbishop of Armagh, the Most Rev John McDowell, called the effigy “an expression of deep hostility”, not a protest.
Speaking on Good Morning Ulster, he said it wasn’t “constructive” to react to immigration in this way and added that people should “try to build up a society which accepts the contribution from all sorts of people because we need it in a small society like Northern Ireland”.
Loyalist activist Jamie Bryson, who was present when the Moygashel bonfire was set alight on Thursday night, told BBC NI he had “no doubt” there would have been violent clashes between police officers and locals had the bonfire not been lit.
He also said nobody in the unionist or loyalist community “should be targeting anybody”.
He added: “I want to reassure the Muslim people that this is not about them as people. People disagree with their ideology, with their viewpoint, but it’s not about them.”
Taoiseach (Irish prime minister) Micheál Martin said those responsible are “sowing hate in society” and he warned that this “dangerous” type of behaviour can have further consequences.
