The cavernous ballroom of a London hotel is buzzing with the sound of networking and deal-making between hundreds of bankers, lawyers and investors from the Middle East, Asia and Europe.
The annual Islamic Finance conference in the British capital has grown exponentially over the past decade, attracting all the key international players and underscoring fears that political rhetoric is leaving the United States sidelined in an increasingly lucrative global industry.
In a post credit-crisis world, Islamic banking is tipped to be a major growth area for international financing. It currently represents around just 2 percent to 3 percent of global financial assets, or almost $1 trillion, but it is growing at an average of 25 percent each year.
Much of the business originates and is carried out in the oil-rich Gulf and in Malaysia, whose capital Kuala Lumpur is widely regarded as the industry's hub.
But investors in the Muslim world, sitting on piles of oil-generated cash that needs a home, are increasingly eyeing Western countries mirred in debt for potential investments. A rising global Muslim population is also fueling demand for retail Islamic banking services.
The race to become the global center for doing business is on. And in the traditional London-New York financial rivalry, the British capital is already streets ahead.
"There has been a resistance to expanding the Islamic finance market in certain countries," Mohamad Nedal al Chaar, the Secretary-General of the Accounting and Auditing Organization for Islamic Financial Institutions, the leading international body that oversees the industry, as he welcomed delegates to the London conference.
"We understand there is a lack of knowledge about the system, but sometimes it's just Islamaphobia," he said, in remarks viewed by many as a veiled attack on the United States, where right-wing commentators have referred to the industry as "terror financing."
Islamic finance conforms to Shariah, or Islamic law, which forbids charging interest and requires deals to be based on tangible assets, providing some insulation from credit turbulence. Speculation is banned, as is dealing in futures, and risk is shared.
For many, that provides a contrast with the speculation and out-of-control risk-taking that contributed to the current global turmoil. Yet for others, it is an alien practice tied up with religious beliefs.
U.S. think tank The Center for Security Policy late last year issued a report titled "Shariah: The Threat to America", which said that practices promoting Shariah were "incompatible with the constitution" and should be proscribed. The report was endorsed by some Republicans.
Former Speaker of the House of Representatives Newt Gingrich has also been outspoken on the issue, calling for a federal law to ensure that Shariah -- and, by extension, Shariah-compliant financing -- is not recognised by U.S. courts.
Paul McViety, a Dubai-based lawyer with Clifford Chance who specialises in Islamic finance, said he often speaks with clients based in the United States, which is home to 2.4 million Muslims who want to understand more about Islamic financing structures and instruments.
"There is some appetite in the U.S. to take the Islamic finance industry forward and to explore alternative sources of funding," McViety said on the sidelines of the London conference.
GE Capital, the finance arm of General Electric, became the first U.S. issuer of an Islamic bond, or sukuk, in late 2009, when it issued a five-year, $500 million bond.
Freddie Mac, the second-largest U.S. provider of home-loan financing, meanwhile, has long been buying Islamic home financing products for borrowers who do not want to pay interest.
But much of this has been lost under the headline-grabbing political rhetoric.
McViety noted that U.S. President Barack Obama has "positioned himself as being innovative -- a thought leader," but, like other leaders post credit crisis, is also caught up in fire fighting.
In contrast, the British government has supported the flourishing industry and there are now scores of Islamic banking institutions in the capital offering products including home loans, current accounts and insurance to the country's 2 million Muslims.
It has the only stand-alone Islamic financial institution in the EU, the Islamic Bank of Britain and according to government figures, it has the highest value of Shariah-compliant assets at more that 8 billion pounds ($13 billion) of any non-Muslim country.
London, being closer to the Middle East, also had a physical and time zone advantage over Wall Street.
Britain came close to becoming the first Western government to issue a sovereign Islamic bond, or sukuk -- it was put on ice because of the same liquidity issues that struck the conventional financing industry.
"If a sovereign embraces sukuk, or another Islamic structure to meet its funding needs, this sends a really positive message to the industry," said McViety.
Robert Tuttle, the former U.S. Ambassador to London who is now a millionaire businessman, warned in a cable to his bosses at the U.S. Treasury that Britain was getting the jump on the United States at a crucial time.
"Should London successfully position itself as a leading Islamic finance center, it could gain an edge on New York, when the global financial markets recover," Tuttle said in a 2009 cable obtained by the Wikileaks website and published in The Telegraph this month.
Still, it may not be a two-horse race. France, which is home to some 5 million Muslims has so far been constrained by secular traditions that have seen Islamic headdresses banned. Unlike Britain, it does not offer Islamic-based retail banking, but is making moves toward issuing a sovereign sukuk and may beat Britain to the punch.