The flag seems to AINOT work in Arabic. You can create your own Unicode normalization function.
ALTER FUNCTION [dbo].[NormalizeUnicode]
(
-- Add the parameters for the function here
@unicodeWord nvarchar(max)
)
RETURNS nvarchar(max)
AS
BEGIN
-- Declare the return variable here
DECLARE @Result nvarchar(max)
-- Add the T-SQL statements to compute the return value here
declare @l int;
declare @i int;
SET @l = len(@unicodeWord + '-') - 1
SET @i = 1;
SET @Result = '';
WHILE (@i <= @l)
BEGIN
DECLARE @c nvarchar(1);
SET @c = SUBSTRING(@unicodeWord, @i, 1);
-- 0x064B to 0x65F, 0x0670 are Combining Characters
-- You may need to perform tests for this character range
IF NOT (unicode(@c) BETWEEN 0x064B AND 0x065F or unicode(@c) = 0x0670)
SET @Result = @Result + @c;
SET @i = @i + 1;
END
-- Return the result of the function
RETURN @Result
END
The next test should work correctly,
select 1
where dbo.NormalizeUnicode(N'بِسمِ اللہِ الرَّحمٰنِ الرَّحیم') = dbo.NormalizeUnicode(N'بسم اللہ الرحمن الرحیم');
Notes: