UK Home Secretary Theresa May issued the orders for his extradition to India and facing trial but gave Shankaran, close relative of former Naval Chief Admiral Arun Prakash, 14 days of time to file an appeal in the case, CBI said.
The order came exactly two months after a British court rejected the appeal by Shankaran against his extradition.
CBI, while pressing for his extradition, had assured the Westminster Magistrates Court in Britain that his bail will not be opposed once he is brought back to face trial.
The 49-year-old Shankaran had listed denial of bail in India among the reasons for opposing his extradition to this country, sources said.
However, after the court was given assurance, District Judge Nicholas Evans had ruled that "a case to answer has been made out" against the accused and that the UK Home Secretary may make the final decision on issuing an extradition order.
The CBI plans to send a team to the UK to bring him back once all legal formalities of that country are completed as Shankaran, against whom an Interpol Red Corner notice had also been issued, may be opposing the decision of the British Home Secretary in the court there.
About giving an assurance, the CBI justified it by saying that he had been named in a charge sheet and all he was required to do was face the trial.
The retired naval commander, who was arrested in London in May 2010, has been given conditional bail, which includes the requirement to live at a new UK address provided by him, a deposit of 20,000 pounds and no right to foreign travel.
Shankaran is one of the key accused in the case of leaking classified information from the War Room to arms dealers. He has been absconding since the case was registered by CBI in March 2006.
His passport was revoked on May 1, 2006 and an Interpol Red Corner Notice was secured against him in July that year.
An Interpol Red Notice is the closest instrument to an international arrest warrant.
Shankaran was first located in UK in 2007 and an extradition request was sent. However, he reportedly fled from London to other parts of Europe before he ran out of luck in 2010 when he was arrested by Scotland Yard.
The UK's Crown Prosecution Service (CPS) had argued the CBI's case that there was substantial evidence to extradite the accused for a trial in India.
In its order, the UK court had dismissed Shankaran's claims that CBI had gone "out of the way to cover up false and fabricated evidence" as having no "merit whatsoever".
The judge had also said extradition hearings are bound by good faith between sovereign states and he is confident that if the prosecution in India no longer felt there was "credible and admissible" evidence against the accused, then it was their duty to end the proceedings and withdraw the extradition request.