I hope we are not confusing "holding elections" by the term "democracy". Holding elections is one thing. Democracy is another.
Just to illustrate the point, how will the head of an islamic state be selected/elected/appointed? Will it be through a popular vote of all adults in the muslim ummah? Or will it be through military power/political hobnobbing? I would think that all adult and sane muslims in the muslim ummah need to express their opinion on who should be their head or Khalifah. That is election.
The actual laws should be based on shariah and need not include the term "soveriegnty of parliament" or other so-called western concepts.