Ferguson has not played for his country since being dropped from the Scotland squad for the World Cup qualifier against Iceland in April by the now departed manager George Burley following a late-night drinking session.
However, the Scottish Football Association have said that they would have no objections to the, as yet unnamed, new Scotland manager recalling Ferguson if he so desires.
"Hopefully the new manager, whoever it is, wants to pick him again and I'm sure, if he is asked, he'll go back and play for his country," said McFadden.
"He has great quality and obviously you're going to miss players like him.
"Barry has got a new lease of life and I think he's started to enjoy his football again since coming to Birmingham.
"There was immense pressure on him at Rangers to perform every week. If they lost, it was his fault and, if they won, it was his good play.
"Since he's come down here, he's managed to relax and enjoy his football again and he's been different class for us - but then his quality has never been in doubt."